Orlando is one of the most popular tourist destinations in the United States, drawing over 75 million visitors per year. This creates strong demand for short-term rentals and hotels in the Orlando area. At the same time, Orlando offers relatively affordable housing compared to other major metro areas in Florida. These factors make Orlando an attractive market for real estate investing. However, there are also risks to consider before investing in Orlando homes and real estate.
Orlando tourism creates strong demand for short-term rentals
As one of the most visited destinations in the world, Orlando has incredibly high tourism. Iconic theme parks like Walt Disney World and Universal Orlando Resort draw tens of millions of visitors every year. This steady flow of tourists creates huge demand for short-term rental properties in Orlando. Investors can profit from buying Orlando homes and renting them out on platforms like Airbnb and Vrbo. However, tourism demand is also vulnerable to economic downturns. A recession could substantially reduce visitors and rental income.
Orlando offers relatively affordable housing prices
While Orlando home prices have increased in recent years, the market still remains affordable compared to other major Florida metros like Miami and Tampa. The median home sales price in the Orlando metro area is around $300,000. That’s well below prices in South Florida. Orlando’s relatively low cost of living and housing prices make real estate investing more accessible to a wider range of buyers. However, fast rising interest rates could offset Orlando’s housing affordability.
Natural disasters pose risks for Orlando real estate investing
While Orlando doesn’t face major earthquake or wildfire threats, the metro is vulnerable to hurricanes and floods. Orlando homes and neighborhoods can sustain heavy wind and water damage from major storms. Hurricane Ian in 2022 and other storms have shown the destruction hurricanes can inflict on Central Florida. Investors should factor in hurricane risks and insurance costs when buying Orlando investment properties.
In summary, Orlando real estate investing has profit potential thanks to strong tourism demand and relatively affordable housing. But natural disaster risks and reliance on tourism pose challenges for Orlando homes and investments.