Rental property investing in Florida: cash flow, taxes, and what to expect

The Florida setup, at a glance

Florida sits at roughly 0.91% effective property tax, which matters more than most new investors realize. On a $320k-$420k Tampa property, that's about $2,912/year in taxes alone - call it $243/month before you've paid anything else. Run the rental cash flow calculator with that line item baked in or your projection will look better than reality.

Eviction stance here is landlord. Landlord-friendly. 3-day notice for non-payment, then unopposed eviction can wrap in 3-4 weeks. Contested cases extend 6-10 weeks. That timeline directly affects your vacancy assumption: in landlord-friendly states like Florida, you can underwrite 5-7% vacancy on B-class properties; in slower states you'd want 8-10%.

Where the math actually pencils

Tampa - $320k-$420k for typical SFR, $1,800-$2,400/mo for 2-3BR rents. appreciation has cooled, STR-friendly pockets, watch insurance.

Jacksonville - $260k-$340k for typical SFR, $1,550-$2,000/mo for 2-3BR rents. still cash-flow possible, military + port jobs.

Orlando - $340k-$440k for typical SFR, $1,800-$2,300/mo for 2-3BR rents. Disney-driven STR market, tighter rules countywide.

The 1% rule (monthly rent >= 1% of purchase) is a smoke test only, but it filters fast: a $340k-$440k property in Orlando renting at the high end (2,300/mo) clears 0.8-0.9% in most cases, so you're already in the "needs the rest of the math to be tight" zone before vacancy + capex + management.

Florida-specific things that bite

Homeowners insurance is the dominant cash-flow killer right now - quote BEFORE you put it under contract, not after. HOA fees on condos can also turn a 7% cap rate into a 3% one.

A few cash-flow-killer line items that catch out-of-state buyers in Florida:

Property tax escrow. Lower than the national 1% average, but the homestead exemption you'd get as an owner-occupant doesn't apply to rentals.
Insurance. Coastal + windstorm zones are seeing 30-60% premium hikes year over year. Quote BEFORE close.
PM costs. 8-10% of collected rent is typical. On a $1800/mo property that's $162-180/mo - works out to about a month of vacancy each year.

What "good enough" looks like in Florida

For a stabilized buy-and-hold in Florida, the rule-of-thumb deal targets most investors I see are:

Cap rate: 6%+ on the actual NOI (not the broker's pro forma). Below 5% and you're paying for appreciation, which is fine if that's your thesis.
Cash-on-cash: 8-10% minimum at year 1 with 20-25% down. 12%+ is solid for the work.
DSCR: 1.25+ if you're using a DSCR loan. Lenders increasingly want 1.2 as a floor, 1.25 to clear comfortably.
Reserves: 6 months of PITI. Even with Florida's fast eviction, you'll burn 1-2 months on turnover + repairs in a bad year.

The play that works here

Florida has tilted toward appreciation rather than cash flow in most major metros. Cash-flow seekers usually need to look at secondary cities or accept lower CoC for the appreciation thesis.

Run your specific deal through the rental calculator with the state's effective tax rate (0.91%), realistic Florida insurance quotes, and 8-10% PM. If it still pencils after that, you've got a deal.