Erwin & Lilyana: Beach property, Florida Panhandle (30A)

The deal numbers

Straight from the client deal tracker: what it cost to get in, and what it returns.

Purchase price$560,000
Down payment$56,000
Closing costs$13,200
Design and furnishing$162,950
Total entry cost$205,750
Annual cash flow$40,976
Cash-on-cash return16.34%

The tax position

Purchase price$560,000
Typical cost seg reclassification25% of price
Illustrative year-one deduction$140,000
Illustrative tax reduction at 40%$56,000

An illustration, not this client's return: 25% of price reclassified at a 40% marginal rate, the same assumptions as our calculator. Your number depends on your study, your rate, and meeting the seven day and material participation tests. We are not a CPA firm.

The full story

Erwin and Lilyana bought in Florida Panhandle (30A), the 30A corridor, one of the highest average daily rate coastal markets in the country. The purchase closed at $560,000.

Getting in cost $205,750. That is $56,000 of down payment, $13,200 in closing costs and $162,950 of furniture, linens, photography and everything else that has to be in the house before the first guest arrives.

The design budget is the line most buyers underestimate. It is not decoration, it is the difference between a property that books at the market rate and one that sits below it, and it has to be funded at closing rather than out of the first season's revenue.

Against that entry cost the property returns $40,976 a year after management, cleaning, supplies, utilities, insurance, property tax and debt service, which is a 16.34% cash-on-cash return.

For context on the market rather than this property: Destin entry prices run $600,000 - $1,400,000, average daily rates $290 - $540, occupancy 56% - 65%, and gross revenue $78,000 - $175,000. March through August, with spring break and summer carrying most of the year. Those are estimates assembled from closings and active comparables, not a projection for any specific house.

The tax position is where a purchase like this earns its keep for a high earner. A cost segregation study reclassifies part of the purchase price into five, seven and fifteen year property, which under current bonus depreciation rules produces a large first-year deduction. Whether that deduction offsets W-2 income depends on the seven day average stay test and material participation, both of which are facts about how the property is run.

Questions about this deal

What did Erwin and Lilyana pay for the property?

$560,000 in Florida Panhandle (30A) in 2025. We publish the market and the numbers, not the street address.

What did it cost to get into the deal?

$205,750 all in: $56,000 down, $13,200 in closing costs, and $162,950 for design and furnishing.

What does the property return?

$40,976 a year in cash flow after all operating costs and debt service, which is a 16.34% cash-on-cash return on $205,750 invested.

Is this a typical result?

No. It is one documented outcome for one property. Across the deals we publish with full financials the average cash-on-cash return is 13.3%, and individual deals in that set range from under 2% to over 24%. Real estate involves risk, including loss of principal.

$40,976 a year on $205,750 in, a 16.3% cash-on-cash return