Canadian Inv…, Home Buyer in Chandler Ginning, Gi...

Villas at Regal Palms, this is the return that investment company promise me , what is your opinion?

Asked by Canadian Investor, Chandler Ginning, Gilbert, AZ Fri Aug 5, 2011

2700 Sand Mine Road Davenport Florida

4 bedrooms 3 washrooms JAMAICA

PRICE : USD 120,000

Plus Their service fee: 3% of the 120,000= 3600

I must pay cash for the property

They guarantee 5% return every year for 5 years ( they will sign the contract)



l They told me that that is the way they calculate the cashflow:

l Property tax : USD $1600/YEAR

l HOA : USD1704/YEAR

l INSURANCE : USD $1420

l THEIR PROMOTION FEE: 20% of the yearly rent

l Other expense: hydro, water, property management ---one third of the yearly rent



They told me that is all the expense, there will be no other expense

Also they promise me that the property tax will never raise until I sold the property, and HOA will not raise a lot, because since 2006, Hoa was the same untill 2011



They Guarantee USD $6000 rental return for my USD 4120,000 investment every year for 5 years。

Help the community by answering this question:

Answers

13
BEST ANSWER
As noted in my answer to your other question, there are lots of foreign websites and foreign "investment" companies touting guaranted returns in the US and offering business plans such as the one you have posted here. The reason they are all foreign is that this would be illegal in the US. Wonder why?

Also as noted in my other answer to you, if you are looking for a hands off invesment, then you do NOT want to be in the short term rental business. Success in short term rental is directly related to how much effort the owner puts into managing and booking the property.

Based on what you were looking at in Arizona, I would suggest that you would be much better off looking at the long term rental market around the medical city at Lake Nona in Orlando. You can read more about it on my website.

Good luck,
Mark LeMenager
Find your next house with the click of a mouse.
Search the MLS without obligation or registration from my website.
1 vote Thank Flag Link Fri Aug 5, 2011
There is no guarentee of % on any investment. There are projections. As for property taxes, investors do not recieve discounts of homestead in the state of FL. So as values of home goes up, so does your taxes. There is no cap as a homestead home has. Please do your homeowrk before any purchase and remember that outside of any fees you have mentioned, there is other cost of up-keep, roof, A/C, etc. considar a home warranty when purchasing a resale home for these unexpected cost. Also damages by the tenants.

Just do your homework and remember, there are no guarentee of ROI, just projections of market conditions, growth, area, rental history.

Good Luck...
2 votes Thank Flag Link Fri Aug 5, 2011
I don't see the membership fees listed, those are currently $3,300 per year and if not paid then guests can't use the facilities - like the water park, which is one of the main reasons guests like Regal Palms.
I'd definitely ask them if they are covering the annual club fees.

Like others have said - I'd be extremely suspicious if someone told me there would be no change in property tax from year to year. That sounds to me like someone who does not know what they are talking about.

I've added a link to Regal Palms fees and costs below.
1 vote Thank Flag Link Fri Aug 5, 2011
Not only CAN'T the guests use the pools etc.They can't even get TO YOUR UNIT.They give all guests a keycard for the gate and your guests will not get that card unless they give the front desk a credit card, which they will hold a deposit on .Remember they get you in and then you see the real Regal Palms
Flag Tue Mar 3, 2015
Hello Canadian!
....If your nom de plum didn't give it away, "hydro" did :-)

First thing that springs out at me is a guarantee of the taxes remaining the same. NOBODY can guarantee that the property taxes won't change. Taxes are re-assessed annually on a market value basis and there are no caps for how much the rates can change for non-resident owners We're also beginning to see some municipalities working to increase their millage rate (the actual "percentage" of the home's assessed value that is charged as tax annually).

I agree with other answerers, 5% is a pretty paltry return, but then again, conservative investing is a safe, long term strategy, especially if you want the unit for yourself down the road.

Get a copy of the contract's, etc, and get them to your lawyer for review. Insist on an appraisal as a contingency of purchase so you can determine if $120K is really a fair market value.

Keep in mind, that while you cannot obtain financing to purchase these condos, once you take ownership, you can take out a loan against yours, often up to 60% LTV.

Good luck!
Alys Esmond
Century 21 Professional Group, Inc.
(321)695-5593
http://www.yourorlandoproperty.com
1 vote Thank Flag Link Fri Aug 5, 2011
It's all B.S

Don't be fooled. Nobody charges 20% for management
1 vote Thank Flag Link Fri Aug 5, 2011
I see there is a charge missing of about $1000 per year that Regal Palms have for basics that get replaced, like towels, bed covers, coffemakers. This applies to those who have the in-house company manage the unit.
1 vote Thank Flag Link Fri Aug 5, 2011
There have been numerous companies that have ,made promises similar that fell short and backed outt of their agreements. Personally I think 5% is a pathetic return and wonder why that would interest you when there are far better out there.

on site mgmt companies do one thing.... make a lot of money off of your investment it is a win for them and a lose for you. I would steer clear and opt for a better return.

All the best,
> Ken Anderson
> ApexOne Realty
> 321-246-3190-Cell
> 321-235-2832-Fax
> http://www.apexonerealty.com
1 vote Thank Flag Link Fri Aug 5, 2011
Always amazed at how long these questions get activity. 4 years on and still get comments. As an update, I did note that there are really a lot of units for sale at Regal Palms currently.
0 votes Thank Flag Link Sat Mar 7, 2015
My opinion is steer clear of Regal Palms! They have as of recent been terrible.They charge 30% of all bookings, you pay HOA as well as a Club member fee, in addition to that your guests are also chrged a $15 per day resort fee.They do not clean the units as they should be and the customer service is horrible.They will say and do whatever you need to hear to get you in.You will not be in charge of your home, they will.They make the rules and if you don't like it and get a property manager they will make your guests visit a living hell.
0 votes Thank Flag Link Tue Mar 3, 2015
Hi Candy
I have a townhouse at Regal Palms too. I completely agree with you, they charge from the owner and from the guest, i think that is not right. Some guests do not want to book because of the resort fee. It's a big problem, i think!! I pay the resort fee every month and i go just one time per year. Why the gustes need to pay more??? I already pay for them every month!! We have to find a solution for that...it is being charged double....
Flag Thu Sep 10, 2015
there are no guarantees. Where do you think the money to guarantee is coming from if the renters do not come for some reason ? do you think that they will put their hand in their pocket and give you their money ? I have seen companies that offer this type of thing come and go in this area. If the going gets too tough and the company cannot keep to its guarantee, they just file bankruptcy and the ' investors ' get no return. Stay safe. Hook up with a local real estate agent who knows what can be achieved and does not give out a load of promises that cannot be controlled.
0 votes Thank Flag Link Fri Aug 5, 2011
there no guarantees. where do you think the money to guarantee is coming from if the renters do not come for some reason ? do you think that they will put their hand in their pocket and give you their money ? I have seen companies that offer thsi type of thing come and go in thso area. If the going get too tough and the company cannot keep to its guarantee, they just file banruptcy and the ' investors ' get no return. Stay safe. Hook up with a loca real estae agent who knows what can be acheived and does not give out a load of promises that cannot be controlled.
0 votes Thank Flag Link Fri Aug 5, 2011
Dear Alan,
I am not seeking investment opinions, I just want to know : Are those numbers true? Thanks!
0 votes Thank Flag Link Fri Aug 5, 2011
in this country you need to be registered with the SEC and have a securities LIcense to offer investment advice. We real estate agents are not licensed to do that. We do not do that. we will not to that.
0 votes Thank Flag Link Fri Aug 5, 2011
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2016 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer