It's no secret that residential real estate has been booming this year due to low mortgage rates and new consumer moving patterns prompted by the pandemic.
Some markets have seen a seismic shift in trends. For example, close to 1,000 people per day are moving to Florida. What was once a state known for entertainment, relaxation, and retirement is now a huge opportunity for real estate investors, brokers, and agents.
Why Is Florida Hot?
Florida doesn't have a state income tax or estate tax, making it a financially attractive destination. The weather is a major plus, and many of the new buyers and renters in the state are coming to Florida to escape the cold climates and snow. New York, New Jersey, Connecticut, Massachusetts, and Illinois are among the states that the new movers are coming from, according to data from Vaster Capital.
Cultural diversity and quality of life are among the other reasons home buyers and renters find the state attractive. Florida also offers a wide range of housing options — from multifamily homes to luxury waterfront properties. South Florida is especially popular. For example, sales of single-family homes in Palm Beach were up 329% year-over-year in the fourth quarter of 2020.
These are just a few of the reasons the state's population is expected to increase from 21.4 million people to a whopping 26 million people by 2030.
How To Take Advantage of Florida's Real Estate Growth
Clearly, opportunities abound in Florida. Knowing the trends is the first step in ensuring your time and dollars are being well spent. Whether you're an investor, real estate broker, or agent, staying on top of facts is key. Here are a few things to keep in mind:
- South Florida is booming. The rental market is strong, so multifamily homes can be great opportunities in this region.
- Although many people are moving to Florida year-round, the vacation rental market is still robust. Consider properties that work well for seasonal stays.
- Inventory of single-family homes is down more than 56% since 2020. To compete in this market, real estate brokers and agents must be especially agile and creative in finding properties, keeping motivated buyers optimistic and engaged, and delivering stellar service throughout the process.
- Some lesser-known communities have become huge housing markets. For example, the highest growth regions in Florida are:
- Cape Coral
- Port Charlotte
- St. Petersburg
If you're planning to invest or flip in an area that you're unfamiliar with, study the data and trends carefully to ensure you see a solid return on your investment. Especially because Florida's weather can be volatile, make sure that when you're rehabbing or investing in a property, you pay special attention to HVAC systems, irrigation, and other home features that can be affected by temperature shifts and storms.
PropStream's rehab calculator, property comparables, and other data-driven tools enable you to do a deep dive into neighborhoods and properties prior to investing. Expenses like HOA and COA fees can also have a significant impact on resale value and ongoing expenses, and you can find these hidden costs through PropStream.
When Will the Florida Boom Slow Down?
According to the experts, Florida isn't slowing down anytime soon. They predict that the Florida market will remain strong throughout 2022 and possibly well into 2023, especially in South Florida. Investors and brokers/agents may see hot deals for some time to come. Be sure you're on top of the trends and equipped with the right tools to get ahead while the Florida market is hot.