Ep028: Florida Isn’t One Real Estate Market – Why Space Coast Investments Behave Differently (And Why That Matters)

Chris McAllister: [00:00:00] Welcome to the Landlord Profitability Playbook Podcast, where it’s my job to create and coach business opportunities and strategies that support add value to real estate investors. I’m Chris McAllister with ROOST Real Estate Company, and today I’m joined by our director of Marketing, Laci LeBlanc.

Good morning, Laci. 

Laci LeBlanc: Good morning. 

Chris McAllister: And a special guest, our Space Coast Florida Owner Advisor Rena Smith. Good morning, Rena. 

Laci LeBlanc: Good morning. 

Chris McAllister: Happy to have you join us from sunny Florida. So we’re gonna talk about investing in, in, uh, Florida today, and specifically the Space Coast of Florida. So when investors talk about Florida, they usually talk about it as if it’s one thing.

Florida is hot, literally, and, uh, from a marketing standpoint, Florida is booming. Florida is risky or they think Florida is a gold mine. It really all depends on who you ask, but that way of thinking is exactly how investors unwittingly, misprice risk misunderstand [00:01:00] their tenants and end up frustrated with properties that don’t behave the way they thought they would when they bought them.

And it’s all because Florida isn’t one single market. It’s a collection of very different regions with very different economic engines, renter profiles, and operating realities. And when you underwrite all of them using the same assumptions, whether it’s population migration, uh, real estate appreciation, tourism, you know, short term rentals like Airbnb and VRBO.

You’re not simplifying the decision. You’re, you’re actually blinding yourself to how the market actually works. And today we’re gonna sort of narrow our lens and talk about one specific region that we know best, and that’s Florida’s Space Coast. So the Space Coast is Brevard County and it actually extends, I think it’s 72 miles arena.

Does that sound right to you from 

Rena Smith: Yeah. 

Chris McAllister: The southernmost point, all the way up past, [00:02:00] cocoa Beach to Cape Canaveral. So the reason it’s called the Space Coast is our county, Brevard County, um, actually is where the rockets take off. So Florida Space Coast. So what’s different about this is it’s not a retirement market.

It’s clearly not a resort market or a tourism driven market. And it’s definitely not a speculative flip First. Environment either. So the Space Coast Economy is built on aerospace. It’s built on defense, it’s built on engineering, and it’s built on year round, professional employment. And that reality shows up everywhere.

It shows up in who rents, the houses in the county, how long they stay in those houses, what they expect from those houses. And it also shows up in how quickly the market punishes poor execution, right? So if you’ve got people who expect to be here for 1, 2, 3, maybe more [00:03:00] years as a, as a, a renter, and you can’t keep a an appropriate house available for those folks at the, at the price they’re paying, quite frankly, you’re gonna lose them.

And that’s what we mean when we say that the market punishes poor execution. So we’re gonna ask Laci to sort of ask us some questions. Rena and I, and uh, we’re gonna kind of break down what the Space Coast actually is, how it behaves, who’s it for, and just as importantly, who shouldn’t be investing in the Space Coast.

So that’s a, that’s a lot to impact ladies. So. I feel like I’ve already gone on for 20 minutes. 

Laci LeBlanc: Well, let’s start right at the top. So you just told us that most investors who are not familiar with this area talk about investing in Florida. Like it’s one thing could be a number of things, but they talk about it, like it’s just one of those things.

Tell me why that is such a dangerous assumption. 

Chris McAllister: I think when people think of Florida, especially those of us in Ohio or in other areas of the country, Florida gets slumped [00:04:00] into a single narrative that’s driven by headlines. You know, sometimes those headlines are as simple as Disney World, right?

They think all of Florida is Disney World. They think of it in terms of retirement and people moving to Florida from. The snowy, Midwest and and Northeast. Maybe they think of it in terms of appreciation, vacations, whatever. But the problem is those types of forces, they don’t apply evenly. And the Space Coast itself really isn’t powered at all by tourism or retirees.

Yes, we do have some tourism, yes, we have some retirees. But it’s, it’s really more like any other city or town, anywhere else in the country that’s powered by, uh, a given industry. And in this case it’s aerospace, defense, engineering, education. So what you have. In the Space Coast are a lot of very, very well educated people.

You have a lot of young families. I mean, my God, Rena, how many schools have we seen go up since we’ve been [00:05:00] there the past few years? 

Rena Smith: Oh, there’s numerous schools. There’s so many people moving here, and they don’t have enough school space for all the kids. 

Chris McAllister: Yeah, I mean, since we’ve been there, my goodness, it’s, it’s just crazy how much growth there has been since, um, I think we started coming, gosh, as early as 2008, and then we bought our first house there in 2015 and, and you beat us there by a couple of years, right?

Rena Smith: Yeah, actually I moved here in oh nine. 

Chris McAllister: In oh nine. So you’ve been there 2009. Yeah. You’ve, it all. I mean, my God, the change from after the crash in oh nine all the way to now, it’s, it’s not even the same place and yet it is the same place because it’s still powered by the exact same economic forces.

There’s just more of it. So when you underwrite, if you, if you look at the Space Coast of Florida as a real estate investor. And you start to underwrite or think about what the value and what kind of return on investment you should get on a Space Coast property. But if you think about the Space [00:06:00] Coast as you would South Florida or Tampa or, or Orlando or you know, the panhandle, you’re gonna make a massive mistake.

You’re gonna, you’re gonna misprice the risks. You’re, you’re not even gonna see the risks and you’re certainly not gonna have a, a good sense of tenant behavior. 

Laci LeBlanc: Yeah, I think you made a good point with Rena being on the ground every day. Chris, you’re there. ROOST is there. Obviously, Rena’s our, our big ROOST presence there.

Chris, you’re there every so often. You’ve own there, so that’s certainly insightful. But Rena, you are there each and every day. This is your home. Tell me from your perspective, how do people usually misunderstand the Space Coast when they first look at it? 

Rena Smith: Well, most people assume beaches and vacation rentals.

What they don’t see is that this is a working region. We have NASA space force and private aerospace. Employers drive year round employment. People move here for jobs and quality of life, not just for the season. 

Chris McAllister: Yeah, that’s exactly right. And that’s why I love it there. Quite frankly, I mean, I love the beaches [00:07:00] that we have there.

It, they’re public beaches, there’s parking. It’s, it’s just a, a very different vibe. But in terms of investing there, you know, the, the difference shows up in everything. The. Length of the lease terms, how long people stay, how often they renew, what their maintenance expectations are, what the maintenance problems are you know, and, and even how fast problems can surface if you have an owner who, who doesn’t keep up with presented preventive maintenance or, or starts to try to save some money and cut some corners here and there.

I mean that, uh. You know, whether it’s the sun, the heat, the humidity, the bugs or the, or the, uh, tropical storms, there’s, there’s a lot of things that can sneak up on you. And if you don’t have that preventive maintenance mindset that you’re willing to invest as you go you people can get hurt. And it sometimes scars them so much that they, you know, they feel like they should sell and move to a quote, safer place.

But the reality is there’s just so much opportunity here. You just have to be [00:08:00] aware of all the things that go into successfully being a real estate investor here. 

Laci LeBlanc: Honestly, it sounds to me as somebody who’s lived in Houston, it sounds more like Houston, Texas than it does like Orlando. It sounds like more of that kind of market with that same kind of, um, you know, professional drive.

Um, and I think that the renters might even be similar. So let’s talk about the renters who actually lives in these homes long term. 

Chris McAllister: Well, Rina, I think you can back me up on this, but I, you know, our typical renter is it’s, it’s often a professional household, even in, um, uh, some of the lower dollar, maybe sub $2,000 a month rent, definitely in the two to $3,000 a month rent.

It’s professional households, engineers, defense contractors. Um, they call it military adjacent families. A lot of the families are dual income, but what’s interesting is even in, you know, a lower priced three bedroom, two bath on a slab built in the eighties, you’ve got people who [00:09:00] are if not, you know, have a master’s degree and so forth.

You have a lot of people with. You know, a solid education, maybe a two year degree and so forth. And they’re in businesses that directly support all of the engineering and defense contractors and so forth. And that’s why, you know, in the time that, uh, you know, we’ve been there, there’s never been an unemployment.

Issue in the Space Coast. I don’t think there’s ever been a time that people were worried about losing their jobs or, I mean, yes, there was some weird things that happened during, you know, after the crash, you know, back in 2000 8, 0 9, there were things that happened with COVID, but this has just always been a very vibrant economy, and the people are there and they rent by choice.

A lot of ’em, rent by choice. They don’t want to own. Whether it’s because they may get promoted and move out, or, you know, maybe it’s just a lifestyle choice, but they rent by choice. They don’t necessarily rent because they’re stuck. And when you have people who want to rent [00:10:00] versus buy, you know, whether it’s because of, uh, you know, insurance rates or whatever, that means their expectations are higher, right?

From a maintenance standpoint, from a service standpoint. But it also means that if you meet those expectations, they’re gonna stay, they’re gonna renew year after year after year. 

Rena Smith: We have a lot of families with kids and people who care about the schools and the locations of commutes and conditions are a big part of it.

And, um, it’s not just bargain hunters. 

Chris McAllister: You know, it’s, it’s interesting too, what you said Laci, about comparing this to Houston. I hadn’t really thought of that. We, I actually met my wife Kelly in Houston and lived there myself for a couple of years, and it is very much like Houston in, in the mix of the economy.

The other thing it reminds me of is Long Island. Where, you know, you, you actually have coastal regions there, you know, just like Houston, you know, down south towards Galveston and so forth. But there’s a lot of of engineering and, and defense and, and manufacturing and so forth. So [00:11:00] it is a, it, it’s almost like what you.

You hear about like Detroit used to be, so to speak. Maybe there’s not as much manufacturing. Maybe it’s more engineering and the manufacturing has done elsewhere, but you know, we’ve got a little bit of both there. So I think that’s one of the reasons why it’s so vibrant. 

Laci LeBlanc: Yeah. How is, so, how is this like industry.

Driven location different from the more retirement driven parts of Florida, specifically that people, I think so, that people think of when they think Florida. 

Chris McAllister: I think you have people that come to the Space Coast and they, they, they want more, they want the American dream. It’s aspirational, right? They, they’re, they’re building for something.

They’re raising families, you know, they, they, you know. They wanna move up in the world, they wanna enjoy the good life and the Space Coast allows ’em to do that. Whether it’s proximity to the beach or proximity to Orlando and Disney World and all that. You know, we’re only an hour to Disney World from where we are.

So it, it’s kind of unique. [00:12:00] Geographically and obviously with all the kids and so forth with fantastic zoos, and there’s just, Rena, you had sports stuff with the kids every single day for God, 18 years, 10 years. But the, and the other thing is, you know, when you’re in a a, a typical resort area or retirement area, there is no vibrancy.

You know, you have people that. In many cases are on a fixed income. You know, even if they have some, some wealth that they’re drawing on each month it’s more about sustaining where they are as opposed to growing and looking forward to a bigger future. And I honestly, of all the places I’ve ever spent time in or, or lived, I really feel like the Space Coast area of Florida, you know, for the most part those people are all looking forward to a bigger future for themselves and their family. 

Laci LeBlanc: Yeah, when you, I mean, I don’t think anybody’s gonna compare the Space Coast to the Gulf Coast for a lot reasons. No. But I do [00:13:00] feel like, as someone who, when we go to Disney, right?

We take the hour, we stay near Disney usually, but we take the hour long trip out to see all of the Space Coast, because. We are nerds really is what it boils down to. But it feels the same as Houston to me, because you’re there for your life, right? But having the beach and having all of these cool features is a bonus, is an added perk, as opposed to moving to the beach and having the other things.

It’s just like a flip flop there. So, you know, I, I do think that. That could lead to some mistakes that investors could be making if they don’t fully understand that. What are, you know, what are some of those mistakes? How does the cost of entering the Space Coast compare to other Florida markets and maybe to Ohio since, you know, that’s our other area.

And kind of what mistakes do investors make after they buy or maybe before they buy? 

Chris McAllister: I, I would say as a rule, you know, the entry cost to. The Space Coast are definitely higher than [00:14:00] Ohio on average. On the other hand, these days you know, when you look at a market like Columbus and Ohio, that’s not a cheap market to get into relative to, you know, a Springfield or Dayton.

But the housing stock is obviously much, much newer in Florida than it is in Ohio. So net net, I’m gonna say, on average, it’s definitely a higher cost of entry than Ohio, but there are still are areas in Columbus where it’s probably comparable. But when you look at the Space Coast relative to, you know, south Florida, Miami area, Tampa.

Naples the pricing is far more rational, right? And what you’re paying for as an investor on the Space Coast is you’re paying for economic and real income durability. It is complete. It’s not about speculation. You know, it, that economy has been doing incredibly well. For years and years and years.

And one other interesting thing is, Florida is, [00:15:00] you know, people are always concerned about hurricanes and there’s been a ton of issues with insurance prices and so forth, but most of those insurance disasters have happened on the west coast of Florida, not on the east coast of Florida. And certainly.

Not on the Space Coast. So what’s interesting is, and if I had any wood here, I would knock on it, but the reason the United States government selected Port Canaveral as the place to shoot rockets off is because historically there’s never been a direct hit of a hurricane at at, at that Cocoa Beach, Cape Canaveral area.

Yeah, we’ve had some high winds, we’ve had some, you know, fences come down and damage over the past few years that Rena and I have owned there. But it’s, uh, it, it’s just not as volatile. It’s like this really sweet spot geo geographically that, I guess makes it more predictable, if that makes sense.

You know, so if, if Ohio gives us yield and, predictability almost across the [00:16:00] state, the Space Coast I would say, gives us some predictability relative to other areas of Florida. The main thing about the Space Coast are those demographic and economic tailwinds and the quality of the income and the durability of the income for the people who live there.

You know, a house in Florida or properties in Florida versus properties in Ohio, especially where we work in Columbus State and Springfield. It’s, it’s just if you have a house in each of those portfolios, every one of those houses is, is gonna do a different job. It’s, they all bring something different to the table.

They bring different benefits to the table. It’s just hard for me when I start talking about and getting excited about the Space Coast to find the downside on the Space Coast. Rita, we gotta get another house down there. Let’s get to work. 

Rena Smith: Alright, all ready? 

Laci LeBlanc: I volunteer to keep it up. You know, you guys are so busy.

Um, just, you know, let me come down and we’ll, we’ll make sure everything goes well. Um, so I asked you a two parter before, let me re [00:17:00] reiterate that second part. Um, I wanna know about the mistakes that investors make specifically when they buy on the Space Coast. Because of the misunderstanding that they have.

Chris McAllister: You know, I’m gonna deferred maintenance again. It gets punished fast. I mean, the sun is intense, right? We may not have direct hit hurricanes and, and massive flooding, but. We still have tropical stores, we still have winds. It is hard to get insurance if you don’t have a, a newer roof.

I mean, basically around here, any roof that’s more than 15 years old is often uninsurable. And the reason is. That the roofs take a beating down here. The sun is hot, you know, the wind is strong. And when there’s a hailstorm that comes through you know, that that can be, devastating.

So. Um, you know, you’ve gotta maintain the property. You can’t wait for the roof to start leaking before you fix it. You can’t wait for the air conditioner to go south when [00:18:00] it’s a hundred degrees in September and not, you know, you gotta have it serviced every single month. The. There’s just so many pests, control, you know, termites, things like that.

You know, there’s, if you have a rental property, especially if it happens to be a multi-unit, you’ve got to invest in pest control. And, and that becomes a preventive maintenance thing because if you let that go. You’re gonna have an infestation, you’re gonna have a disaster. If it’s termites, it’s, it’s, it’s different than if you’re in Ohio and it’s wintertime and, uh, the pipes freeze.

Right? It is a different set of problems, and it’s almost all related to temperature and climate, but like a sloppy turn. Any, any time, uh, somebody who’s turning a house or, this rehabbing house starts to cut corners. It’s just hard to explain, but man, it shows up really, really fast in, in a Florida market.

Whereas, you know, maybe some of the issues can stay hidden a little longer in, in other type [00:19:00] of, maybe places in the country, if that makes sense. 

Rena Smith: Residents are just looking for clean, well maintained homes. They rent much faster or lease or whatever you wanna say, but poor execution costs more than the people expect.

Chris McAllister: I mean, when you have a, a vacancy down there arena, how long does it generally take for you to, to find the qualified applicant down there? 

Rena Smith: Usually when something hits the market, I’ll probably get 10, 12 applications with like in a week and maybe two of them or two applicants are good. Yeah. After you run background and checks like that but we get quite a bit of activity if the price is right.

Sometimes. Owners will wanna try to rent honestly, for more than what it’s probably worth, but it, it just sets on the market for a lot longer to try to get that person that, that wants to pay that. 

Chris McAllister: Yeah, I would agree. Yeah, it’s price sensitive, but the prices are a lot higher. 

Rena Smith: Well, they are, they’re definitely a lot higher, 

Chris McAllister: but people are, you know, [00:20:00] they’re incredibly well educated and they’re very well informed.

I mean, they, they can look up what, rental properties are going for in a given area just as much as we can, and, and. When you have an owner for whatever reason, whether they, you know, pay too much for it upfront or whatever, and they either just want to get more or they have to get more. In either case, my gosh, the even more so than in Ohio, I think the.

Prospective applicants slash the market punishes that kind of behavior. 

Laci LeBlanc: Yeah, 

Chris McAllister: really quickly. And really, obviously 

Laci LeBlanc: I had not even considered the sun and how much hotter it is and how, what a difference that might make for maintenance. Um, and we talk a lot about maintenance, so it’s always top of mind, but that never crossed my mind.

And we have a neighborhood here that faces like, do east. And none of the homes have just a simple, you know, awning or a porch on the front. So all of their front doors are constantly like they look. 15 years older than they are because they’re [00:21:00] direct in direct sunlight for the first, you know, half of the day.

And they, they rent for less. Right. When we were looking for a home to buy, we avoided that neighborhood entirely because even though the homes are really nice inside, we could see that on Zillow or wherever we were looking. Um, on the outside, they don’t look as nice. And the whole neighborhood suffers because of it, because of the poor, poor maintenance and.

And there are a lot of rental properties in that neighborhood. And because, you know, I guess poor planning, right? Facing them all in that direction and giving none of them sun protection. But I just think that’s really interesting and something that people probably don’t think of. ’cause we, I think of this stuff for a living and that didn’t occur to me.

Um, so I think that’s a really good point about you know, knowing the market and what mistakes you could make. But one thing that you guys keep talking about is management discipline. Why does management discipline. Matter, like what is that? Define it for me for people who are listening, but also why does it matter so much here, specifically on the Space Coast.

Chris McAllister: Again, huge [00:22:00] professional people, professional tenant base, right? These are people who, in many cases, are renting by choice. They’re, they expect to pay, you know, fair market value for the property, but in return, you know, they expect communication from the property management or the owner. They expect them to be responsive.

They expect a condition to be. You know, at the neighborhood standard, if, if not above, you know, and the one thing about Florida and the neighborhood standard, the neighborhood standard tends to go up over time and it’s obvious that it’s going up over time. Whereas a lot of the neighborhoods in, in Ohio and the rust Belt tend to be more stagnant.

You know, the market rewards operators, owners land landlords who run their rentals like a business. That they don’t run it like a hobby. I would say that, you know, we probably, I’m sure we have our share of, uh, quote accidental landlords, you know, in, in the Space Coast area. People who for whatever reason ended up with an extra house, you know, whether it was from an inheritance or something like that.

But, and I [00:23:00] don’t have anything, you know, in the middle of this podcast to back it up. I will tell you that I don’t think that they don’t stay. Uh, landlords long because you’ve got to be intentional about it or you’ve got to have professional help and you’ve got to be willing to pay for it.

The other thing that’s interesting is, and I think Rena, you’ve got this nailed, why do you think, um, you are the five star Google Review queen here at ROOST Real Estate Company. So if anybody wants to check out Roo down in, uh, the Space Coast, you’ll see our Google reviews are just outstanding there.

But why do you think reviews matter so much? You know, I, I guess reviews matter everywhere, but it just feels like, I guess it feels like if when in Florida they either really, really love you or they don’t even bother. Is that fair? 

Rena Smith: Yeah. Reputation travels fast. You know, in smaller professional communities, um, you know, your name gets out there and your company name gets out there and they see what you’re doing and they see your reviews and it really does matter.[00:24:00] 

Chris McAllister: Well, I think it, it matters dramatically, and I, and I think it speaks to, a huge degree about how well you do your job and how professional you are. I mean, my God, those reviews are just incredible and they, they just keep popping up, every single week I see another new five star review for Arena.

So thank you very much. 

Laci LeBlanc: Yeah. And they’re not just from owner clients, right? So as a property management company, we’ve got two clients. We’ve got our owner clients, and then we’ve got our tenant clients. And in this market, it feels like because there is that professional tenant base that expects the communication and the responsiveness that for an owner, the tenant reviews matter as much as the other owner reviews.

So if you’re considering property management. In this area, look for other owner reviews, but also look for the tenant reviews, because those matter here more than potentially other places. Um, just because of the professional tenant base like you mentioned. So, and you do a great job on both of them.

Obviously we’re, we’re really proud of those, but I would [00:25:00] be remiss if I didn’t mention it as the marketing person on the call. But moving forward. Let’s talk about who should and who should not be investing in this space? ’cause Chris, you mentioned that this plays a different role. The properties in this area can play a different role in the portfolio than say, properties in Ohio.

So who shouldn’t be investing in this space coast with their portfolio in mind? 

Chris McAllister: Any investor who’s looking to buy, you know, is just looking for the cheapest possible. Way to get into the market or the cheapest, possibly cheapest possible deal should not be wasting their time looking in Florida.

Right. If you’re an owner, who, if it, if you’re an owner who doesn’t have the discipline to take some of that rent money and put it, you know, set it aside for reserves, Florida’s not gonna be the market for you. You, you’ve gotta be willing to look at the market as you’ve gotta maintain the house.

And we’ve already, you know. I talked about all the reasons you’ve gotta maintain the house and you know, maybe you [00:26:00] won’t get, you certainly won’t get the same amount of monthly cashflow on a house in Florida, as you would say from a house in Springfield, Ohio. But what you will get if you fund the reserves, if you do the, if you don’t let deferred maintenance get out of hand, if you keep up with the house, when it does come time to sell that property, to liquidate that property.

The appreciation that you’re going to enjoy is, is just going to make it all worthwhile tenfold, right? Again, who’s it not for? If you’re chasing the cheap deal, if you’re not gonna fund reserves, if you’re not gonna take care of the house, if you’re looking for, you know, just to be completely hands off and, and just let it run by itself without any, you know, infrastructure, professional management.

I, I, I, I just have to be honest, you’re gonna lose. 

Laci LeBlanc: So that leads me to my very obvious next question, which is, who is this market ideal for? Who should be investing in the Space Coast? 

Chris McAllister: You gotta be looking at it for the long term. And I, you know, I preach that [00:27:00] constantly. We’re always in it for the long game.

You’ve gotta be, you know, a portfolio builder, right? If you’re looking to have multiple homes. You know, you may not want to have all of your eggs in one basket on the Space Coast. Maybe you do want to have homes in, uh, you know, Ohio and Florida, or maybe there’s other parts of Florida, or maybe you wanna mix in your portfolio of short-term rentals and, and long-term rentals.

The point is you have to be intentional and. The other thing is there’s, again, I love the Space Coast, but I never thought of it that it was overhyped or sexy. Right? The Space Coast area is for owners who value predictability over hype, and they’re, and they value execution over, you know, just setting it and forgetting it because that never works.

So it’s, you gotta do the work. Or hire somebody to do the work, but the rewards and the predictability, the income I just absolutely believe are second to none. 

Laci LeBlanc: So if, for listeners, uh, [00:28:00] what would you say is the one thing that they should remember about the Space Coast? 

Chris McAllister: Well, I would say that it’s not one market, right?

It, the Space Coast behaves differently because it’s built on real employment, it’s built on families, and it’s built on long-term demand. Yes, you’ve got the same percentage of retirees as any other city in the country. Does. And there are some, you know, vacation rentals and there are people who go a vacation there.

But I would also argue that the people who go to VA vacation there do so because of proximity to family who already lives there. So if you understand the type of tenant that, that you, that lives on the Space Coast, if you understand their behavior and you’re prepared to invest accordingly. My gosh, homes in the Space Coast, they can just play a huge role in a, their, a diversified portfolio.

And I know it, it’s paid a huge, played a huge role in, in, you know, my personal portfolio with the couple of houses that we have down there. 

Laci LeBlanc: Yeah, I think that’s one, one place where we have [00:29:00] a unique. Connection. Right. We actually have a little popup on our site if you go visit our site that talks about how ROOST is the connection between Ohio and Florida Space Coast.

And being able to look at, again, as a property manager, a variety of portfolios and see how properties in these areas are which roles they’re playing for different investors, I think is a really unique. Place to come from, and I think that’s why we don’t necessarily hear other people talk about Florida.

In this way when other property managers, when people talking to real estate, I, visitors address Florida, they do talk about it like it’s all Airbnbs, right? And it’s all short term. Um, so I think that, you know, being at ROOST obviously puts you in a, a unique position to, to talk about both. Earlier we talked about, earlier in this season, we talked about how Ohio isn’t safe, it’s predictable.

Investing in Ohio isn’t. Safe, it’s predictable. Today we’ve talked about Florida and the Space Coast as something very different [00:30:00] than people expect. Can you connect these two ideas for our listeners as the expert and the connection between Ohio and Florida? 

Chris McAllister: And again, I think the common thread is market behavior.

By market behavior we actually mean what the, what the people who live there expect. Right. In the Ohio episode we just did, we talked about how markets like Columbus State and Springfield behave in very different ways, even though they’re, you know, in the same state and literally what, maybe 75 miles apart on Interstate 70.

But you know, Florida to some degree works the same way the mistakes investors make is treating markets as interchangeable instead of understanding the role each market plays. Right? So I. Uh, just like there’s differences between Columbus State and Springfield and it’s very close together, there’s differences in Florida all over the place.

And again, I keep coming back to the Space Coast is is one of the most unique places that I’ve ever [00:31:00] found in, in, in, in Florida. So at our company, at ROOST Real Estate Company, we think in terms. Portfolio construction, we don’t think in terms of isolated deals, right? Our, our sweet spot is helping people go from, you know, one house to 10 houses to 20 houses, right?

It’s about people who wanna build a portfolio for the long term, and we’re uniquely, equipped to help people do that, but when you, just to try to bring home the last couple of episodes between the Ohio market and the Florida market, Columbus, Ohio is about liquidity and long-term growth, and it’s not forgiving on the front end.

If you miss buy, it takes years to to make up for it, but it does give you exit options and it gives you appreciation over time. Dayton, Ohio is about stability. It smooths cash flow out and rewards consistency more than speed. And Springfield is about yield and execution discipline, right? You can make a really great monthly cash flow in Springfield.[00:32:00] 

If you’re a good operator. So Springfield, is about current cash flow each month, less about long-term appreciation. But if you’re in Springfield, Springfield magnifies decisions, whether they be good decisions or they real, they be the bad decisions because you just don’t have that appreciation, driven forgiveness.

And the Space Coast, you know, does something all together. You know, space Coast is a fourth market after Columbus State and Springfield. It brings demographic. Tailwinds and it brings income quality because it’s, again, it’s driven by real employment. Professional households, long-term demand. It’s not about tourism, it’s not about speculation, it’s just predictability of a different kind than we talk about, uh, Ohio being predictable.

So I think when our investors, you know, understand how each of these markets behave, they can combine, you know, properties in each market very, very intentionally, right? So if you’re in Ohio, those properties tend to help control risk. They help control cash flow. Buying on the Space [00:33:00] Coast enhances dur income, durability, and demand quality.

But together. You know, you put that stuff together, it reduces overall volatility of the portfolio in a much better fashion than if you decide that you’re gonna buy all of your houses in Springfield or all of your houses in the Space Coast. I think there is real value in intentionally spreading that portfolio around.

And again, you know, we are in a unique position to help people do that. 

Laci LeBlanc: Yeah, I think that there’s a, people see a risk to investing in different locations, right? If you’re in Ohio, you wanna invest in Ohio. If you’re in Florida, you wanna invest in, hi Florida. If you’re investing in Ohio and Florida, you can’t be both places unless you’re you, I guess.

But, so I think people see that as a risk sometimes. But what I’m hearing from you is that the potential reward for investing in these different markets is big. 

Chris McAllister: Yeah. Worth 

Laci LeBlanc: considering. 

Chris McAllister: Absolutely. And I, I will also say, you know, when [00:34:00] we first got to Florida you know, I had a long-term client who’s still a client and a great friend in Ohio.

That when he found out we were coming to the space close, then he was doing a 10 31 exchange. You know, I think they bought 10 or 12 houses, you know, that first year that, that, uh, we were licensed down there and we still, Rita still manages those houses for them and they still live in Ohio. And then, you know, my friend Johnny, who used to run stores with me at Target on Long Island years and years ago, he’s got, he’s bought a couple of houses down there in the Space Coast that he still owns.

And, uh. So the, there, there, there is a, a thread, you know, count me as the third person we know, of course Rita’s been in both markets. Um, that, uh, you know, when you have the right management, when you’ve got a five star operator like Rina on the ground, you know, you can, you could invest in, uh, Florida and Ohio and still sleep nights.

So. I, I guess that’s my final [00:35:00] pitch there, Laci. How did I do from a marketing perspective? 

Laci LeBlanc: Fantastic. Couldn’t have written a script for you. That was better than that. 

Chris McAllister: All right, Rita, anything else today? 

Rena Smith: No, I, I think everything was pretty much covered. This was great. 

Chris McAllister: Okay. Laci, that it for today 

Laci LeBlanc: Sounds good to me.

I’m excited to, to get this out there and for people to dig deeper in the possibilities that the Space Coast has to offer them. 

Chris McAllister: All right, well, anybody listening who wants a, a deeper written breakdown we’ve got a blog blog post out there at at Learn with ROOST, and we’ll put the link in the show notes about investing in the Space Coast.

And if you missed our previous episode that we did for the Landlord Profitability Playbook Podcast called Investing in Ohio isn’t safe. It’s predictable, and that matters. We’ll have that link in the show notes as well. And if you’d like to learn more about how we work with investors, you can check us out@investwithROOST.com.

Thanks everybody, and we hope to, [00:36:00] uh, be speaking to you again soon. Be.