British Corner: From a different perspective.....
What does the vote to divorce the European Union mean for Florida's residential home market?
The British Corner tries to give you some more information about the US market. However, we must admit that we do not have a crystal ball somewhere hidden under our bed. Therefore, we can not accurately predict what the future holds. But we can try to narrow it in.
So, the main question is: What are the implications of this step? Will it end in a catastrophic or only with a black eye?
Fact is that the number of home buyers from the UK remained strong during the last years. Home buyers from the UK had many reasons to continue buying property in Florida. One reason may be the fear that the British currency will take a hit, but many home buyers bought a property simply because they want to live in Florida for a while.
Where do they Buy Property in the Sunshine State
The Atlantic Coast is pricier than the Gulf Coast. Miami, Fort Lauderdale, and Palm Beach are driving the property prices up into the stratosphere in that area. However, one can not say that the prices for homes along the Gulf Coast are in general lower. There are certain spots, like Naples, Bonita, St. Petersburg and the barrier islands, where the prices are going through the roof as well. The last hurricane did effect the prices in Naples a little, but not so much that you can buy a $500k home for $300k now.
Central Florida is not that expensive, but it is also a vast area far away from the beautiful beaches. People who like the warm Gulf water and palms swaying in the breeze, do not go to central Florida.
Ocala is the place where the horses roam, and Orlando is home to Micky Mouse and his ilks. However, Orlando is easy to reach, and that is a big plus for some home buyers.
Homes are still not cheap. Properties in both areas can be on the pricey side, too. Especially Orlando became a Hot Spot within the last years because of the easy access from all over the world. In case you want other people to rent your home while you are gone, that is an easy task with all the tourist attractions around. Because there are convenient flights from London and Canada, home buyers with Canadian or British passport are representing the majority of buyers in Orlando now.
More local variations
There is a lot of variation at the local level as well. In certain areas, the property values are far spread. One hundred thousand dollar homes are next to two million dollar homes, basically are in the same location. In the higher-end end market, there are spots where 2 million dollar homes are sitting next to 10 million dollar homes.
Both locations are problematic because you want to have the home values a little more uniform. But what can you do when all of a sudden the location becomes a prime location and time is needed to replace the older and cheaper homes with new and more expensive ones.The location is always the prime consideration. Often it takes time to fade out the properties that do not fit the market.
Single Family Home or Condominium
The type of property is also critical for certain areas. Single family homes in gated communities are a very attractive option. They offer privacy and security paired with a wealth of communal facilities. Condominiums are common in urbanized areas. When land is scarce or expensive, it makes sense to build into the “cheaper” sky.
Waterfront properties are always very attractive and rewarding when you want to sell the property later. Gulf view is a prime location and nothing beats that. Canal or river view with boat dock comes next, and lake or pond view are still preferable.
While security and social options offered by gated communities will appeal to some, there are also plenty of choices for the home buyer, who does want to live outside of a gate. However, if you can use the home only part time as a vacation home the security aspect while being absent may play a significant role.
Do you need Rental Income?
If you want to lease the home while you are abroad, you need to factor in some other thoughts. Proximity to a golf course, the beach, or to “tourist traps” – tourist attractions might be a better word – will always be a major factor. You will not be able to get a decent rent if the property is not located in a touristic area.
You Don’t have too much buying power?
Those on a tighter budget might look at other options. However, there are not too many reasonable ones left. Stay away from mobile or manufactured homes. They rarely keep the value, and in the case of a hurricane, these cheaply built dwellings tend to fall apart. You are better off buying a low-end condo instead. Of course, those modern manufactured homes look great on the prospectus, but the reality can sometimes be harsh in the Sunshine State.
Where are the Hot Spots?
Miami/Miami Beach: Miami is a world class city with a lot of high-end properties. The city is also the gate to South America, and the Latin influx is predominant. The International Airport is a huge plus and drives a lot of people from all over the world to this magnificent city.
Naples: Naples and Bonita are also a hot spot on Florida’s Gulf Coast. This location clearly profits from the proximity to Fort Myers International Airport. High-end properties are dominating the market and many wannabe homeowners are priced out. $200k – $300k gets you nowhere.
Sarasota/Bradenton: Florida’s cultural capital on Florida’s Sun Coast. The Sarasota/Bradenton area combines beautiful beaches with a wealth of cultural activities. However, Sarasota’s International Airport never took off like expected. Unfortunately, there are not too many Airways offering direct flights to Sarasota. Tampa International would probably be the best bet. But Fort Meyers is also only 90 minutes away.
Orlando: Easy to reach. Combines family fun (Disney) with world class golfing and reliable rental returns. Orlando is the world’s single largest tourist destination and easy to reach. Many airlines are offering direct flights to Orlando. However, the beaches are far. If you are are beach boy/girl you might not be too happy in Orlando.
