Low summer 2006 bookings, TDC to increase advertising

[Paula]

"I would be surprised if any home purchased in the last four years was showing even a small net profit if financed conventionally."

We bought one of our cottages in 2003 and the other in 2004 (with conventional financing) and we are able to almost cover the cost of mortgage, taxes, insurance with rentals. The rentals don't cover the other monthly expenses or the initial investments we made in furnishings and equipment, though. However, the cottages have increased in value enough (even with the slow-down because we bought about 6 months before the prices peaked, so we're doing OK.) The hope and expectation, of course, is that we'll get more renters in the fall and winter to cover the rest of the expenses and the value of the properties will start going up again. We plan to hold onto these places anyway for the long-term (So, we're not desperate for values to go up again) because we love them and see them as places to spend many future years/decades with friends and family.

 

[SHELLY]

The hope and expectation, of course, is that we'll get more renters in the fall and winter to cover the rest of the expenses and the value of the properties will start going up again. We plan to hold onto these places anyway for the long-term (So, we're not desperate for values to go up again) because we love them and see them as places to spend many future years/decades with friends and family.

If the dollar continues to weaken against the Canadian "loonie" you may want to think about focusing your advertisements to folks in the "Great White North" for the upcoming fall/winter season. By that time of year, tapped-out American consumers from up North will be chosing between spending what they've got to either buy fuel oil to keep warm; put gas in the car; make the mortgage/HELOC payment; or buy the kids Christmas gifts.

 

[spinDrAtl]

The snowbirds that rent in our complex are retirees looking to get out of the cold, not pay a heating bill. Many of them have been coming for years and now have their own little 'community' in the winter.

 

[Lady D]

I've talked to the man we rent from back several months ago but failed to ask him how that area of beach looks now. He did mention he still has no walkover though. I am hoping some sand has washed back up on that stretch helping it out some. Can't wait until the end of August.

 

[Kurt]

In light of the recent discussion about 2007 Summer rentals I thought some might like looking back at this thread.

 

[Paula]

"I would be surprised if any home purchased in the last four years was showing even a small net profit if financed conventionally."

We bought one of our cottages in 2003 and the other in 2004 (with conventional financing) and we are able to almost cover the cost of mortgage, taxes, insurance with rentals. The rentals don't cover the other monthly expenses or the initial investments we made in furnishings and equipment, though. However, the cottages have increased in value enough (even with the slow-down because we bought about 6 months before the prices peaked, so we're doing OK.) The hope and expectation, of course, is that we'll get more renters in the fall and winter to cover the rest of the expenses and the value of the properties will start going up again. We plan to hold onto these places anyway for the long-term (So, we're not desperate for values to go up again) because we love them and see them as places to spend many future years/decades with friends and family.

Good idea to revisit this Kurt. I saw my own post from a year ago and here's what happened since: We still love our cottages and SoWal and have made more memories ; the cottages in our community are starting to sell again and have found a price that works (and made money for people who bought initially and early on, but those who bought more recently will have to wait a while); we had one winter renter in one cottage for 3 months last year and have both cottages booked with winter renters this year (they're getting it for a song but it pays the bills and pays some of the bills - and I'm glad the winter renters will be happy with the good deal they got); we had about the same number of renters for spring/summer, with fewer so far booked for fall; we haven't raised our rental rates in 3 years; I do spend quite a bit of time managing the cottages together with the management company -- e.g., marketing, cleaning, staying up on repairs, etc.; Not having hurricanes for a few years has been a big help - beach is nice and sandy now (though the sand comes and goes and I don't worry about it any more and just trust in Mother Nature); my accountant said the cottages increased in value about 8% per year - which isn't bad if one has a balanced portfolio; The second cottage wasn't as great an investment as the first cottage, but it sure has been great to have for parties with friends and family (I hope to just pass the cottages on to the kids someday anyway and hope that having fun in them now will keep bringing them back to the cottages with their own families over the years); I still have no regrets and am thankful daily for having a little piece of sunshine and lots of friends in SoWal (I'm especially thankful every winter when I think "Someday winters will be spent in South Walton...)"