host posted on March 09, 2009 15:11
As a CPA I was trained to look at net income, cash flow, return on investment (ROI), cap rate and other quantifiable measures when evaluating a potential investment in real estate. This is necessary but not fun. It is simply a number crunching with no emotional attachment whatsoever.
The questions are always the same:
What is the historical rental income?
What are occupancy rates?
What is the potential rental income?
What are the taxes and insurance, maintenance and HOA fees?
What is the mortgage payment?
Can the rental income from the property cover the operating expenses and mortgage payment?
When the property is sold, how much will it have appreciated?
How much gain will be realized?
What are the tax implications?
Is this a PRACTICAL investment?
Amidst all the bean counting and number crunching, I looked forward to our annual escape to South Padre Island with our best friends. I always loved to come to the island, and I always hated to leave. Eventually my husband and I decided to purchase a condo and combine our place for fun with a practical investment. In evaluating our investment from a different point of view, we answered a whole new set of questions:
Do we like the property?
Can we picture ourselves sitting on the balcony watching the Gulf, taking in the sunrise each morning... or watching the sunset over the bay each evening?
Will we enjoy a walk on the beach within steps of our front door?
Will we enjoy being able to jump in a car or on a plane without having to even carry on a bag because our owner's closet has all we need?
Will we treasure special moments with family and friends when they stay at our "Beach Home".
How much will we gain by being able to escape the usual more often to go to a place that we love?
Is this a FUN investment?
The answers to these questions were easy.
So, after 30 years in the big city business world, I somehow landed (semi-intentionally) at South Padre Island with a real estate license. Now it is my job to help others make practical investments in fun. The same property can meet both needs. Whichever approach you use to evaluate your investment, there are properties that fit. And we stand ready to help you evaluate your South Padre Island real estate investment from either point of view... or both!