Gross yield is what gets advertised. Net yield is what you keep. In Florida the gap between the two is wider than most buyers expect, and the single largest reason is insurance — the state runs roughly two to three times the national average premium. A property advertised at an 8% gross yield can land near 3% net once the real costs are applied.
Property tax
Billed annually by the county on assessed value. Effective rates across Florida counties commonly fall in a band around 0.8% to 1.2% of value, though the figure varies with the taxing districts a property sits in.
Note that the Homestead Exemption, which reduces the taxable base and caps annual assessment increases, applies to Florida residents on a primary residence. It does not apply to a non-resident investment property.
Insurance: the Florida variable
This is where Florida differs structurally from the rest of the country, and where published figures diverge the most.
Insurance.com puts the Florida average at US$ 8,471 a year against a national average of US$ 2,872; a separate cut of their data, assuming a 2% hurricane deductible, gives US$ 7,136 against a national US$ 2,543. Insurify puts Florida at US$ 6,408 against a national US$ 2,808. NerdWallet, measuring at a US$ 300,000 coverage level, reports US$ 3,390.
The spread is not sloppiness; it reflects genuinely different assumptions about coverage limits, hurricane deductibles and construction type. What the sources agree on is direction and magnitude: Florida runs roughly 2.2 to 3 times the national average, and it is the most expensive state in the country.
Roof age and construction standard dominate. A newly built home under current Florida building code typically insures materially cheaper than an older property of the same value — which is a real, quantifiable argument for new construction that has nothing to do with aesthetics.
HOA and condominium fees
Master-planned communities and condominiums carry monthly dues covering common areas, amenities and, in condominiums, often the building envelope and its insurance. Condominium assessments in particular have risen in Florida following structural reserve requirements introduced after Surfside, and a building with underfunded reserves can issue special assessments on top of the regular fee.
Read the reserve study before buying into a condominium. It is the document that tells you whether the published fee is the real fee.
Management, vacancy and maintenance
For a long-term rental managed remotely, management typically runs around 8% to 12% of collected rent. Short-term and vacation rental management runs far higher, commonly 20% to 30%, because the operational load is greater.
Vacancy should be budgeted even in a strong market — a conservative assumption is a few weeks a year. Maintenance reserve is commonly set around 1% of property value annually; for new construction under warranty the early years are usually lighter, but the reserve should still exist.
What this looks like on a real property
Take a US$ 350,000 single-family home in Central Florida, let on an annual lease at US$ 2,300 a month. Gross rent is US$ 27,600 — a headline yield of 7.9%.
Now apply costs: property tax at 1.1% is US$ 3,850. Insurance at US$ 3,500, assuming new construction. HOA at US$ 150 a month is US$ 1,800. Management at 10% is US$ 2,760. Vacancy at 5% is US$ 1,380. Maintenance reserve at 1% is US$ 3,500. Total operating cost: US$ 16,790.
Net operating income is US$ 10,810, a net yield of 3.1% on the purchase price — before financing cost and before tax.
These are illustrative assumptions, not a quote. Change the insurance figure by US$ 2,000 and the net yield moves by more than half a point. The purpose is to show the shape of the gap between gross and net, not to predict your result.
Why the number is still worth it for many buyers
A 3% net yield in dollars, on an asset in a jurisdiction with deep liquidity and enforceable title, is a different proposition from a higher nominal yield in a volatile currency. That is the trade being made, and it is a legitimate one — but it should be made with the net number in front of you, not the gross one.
Leverage changes the arithmetic again. Financing lowers the capital at risk and raises return on equity when the spread is positive, while adding the obligation of the payment. That is a separate calculation and should be run with real loan terms.
Sources
- Insurance.com — average homeowners insurance rates by state, 2026
- Insurify — average home insurance rates by state, 2026
- Insurance Business — Florida premiums against the US average
- National Association of Realtors — foreign buyers, April 2025 to March 2026
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