Current homebuyers are old enough to remember the rise of the housing bubble pre-2008. The rabid approach to real estate collapsed spectacularly, which proved to be just another symptom of the Great Recession that impacted politics, society, and families even today.
Today, housing prices have spiked 40% higher than they were in 2007. With such a significant jump, even the government is trying to step in. There is a perfect storm of factors contributing to this jump—a pandemic that scrambled typical population dispersal, an entire generation of millennials that put off home buying until this point, and limited construction of new homes—that the government is trying to prompt new construction.
However, if you're looking for a home, there are still some great options available despite the price hike. Real estate is an investment, one that tends to gain value over the years if you hang on long enough.
And what better place to invest in than Florida? That's why we've assembled a guide to Florida real estate, full of expert predictions about how the market will change through 2021.
1. Florida's Popularity
For decades, Florida has been quite popular with snowbirds. People spend part of their year in Florida, and it's always been a hotbed for seniors that choose to live there year-round.
The population is predicted to rise sharply in upcoming years. After almost two years in some form of danger from a global pandemic, people are ready to get out. What better place to do that than Florida?
With world-class arts, culture, and fine dining in cities like Miami and Tallahassee, it's the perfect place to get out and experience things you've missed. Let's not forget about the beaches, either.
All of these factors, in addition to the strong job market, will lead to a steady increase in Florida's population. When it comes to real estate, this means there will be sharp competition for prime locations.
Finding a fine old Florida home with classic details will be more impossible than ever. If you have money and patience, it's possible. But prepare yourself to pay far more than you would under normal conditions.
With the population increase, efforts are being made to stimulate the construction industry. If these efforts are successful, it could mean that more new homes will be on the market sooner rather than later.
With the current housing market in Florida, any of your options will require a great deal of patience.
2. Vacation Rentals
If you want to invest in Florida real estate, now is the time. But what if the timing isn't right in your personal or professional life? Florida real estate can still work for you.
With the above-mentioned factors, people will still be coming to Florida in droves, even if they aren't looking to move. Maybe they are just visiting to scope out a future move, visit family, or take a vacation near some world-class dining and beaches.
The revenue coming from vacation rentals is expected to reach $88 billion by 2023. With the advent of 'revenge travel', this number could be even higher than previously anticipated.
If you buy real estate in Florida and set yourself up to rent that home to others, you could be looking at a hefty revenue stream. Then, when you're finally ready to move into that home yourself, everything will be ready to go!
3. Buyers Have An Advantage
Most experts agree—right now, real estate trends in Florida dictate that it's a seller's market. Homeowners can sell their property for a much higher price than they initially bought it for.
However, in this case, the Federal Reserve is on your side. Due to the withering economy caused by the pandemic, the Reserve took steps in an attempt to prop it up. One of these steps was ensuring low interest rates when taking out a homeowner's loan.
For now, interest rates are quite low. This is a huge advantage for buyers who want to lock in a low rate now, especially if you've found the home of your dreams like south beach apartments and want to stay there for the foreseeable future.
4. Speed is Your Friend
When you invest in real estate, playing your cards right is crucial. Many buyers who have decades of experience with real estate trends in Florida know about playing the waiting game.
In the past, the waiting game has been great for savvy buyers who are able to do so. If they are in no rush to move from their current location, exercising patience can save them thousands of dollars.
However, this housing bubble is different from the ones that have preceded it. Experts, especially the ones that did predict the 2008 crash, aren't predicting a similar catastrophe.
The lending and buying world is a different place than it was pre-2008. Wall Street learned its lesson, and so did many buyers. In years before the Great Recession, lending was a free-for-all.
It was so easy for many people to buy homes, even ones that weren't good candidates for a bank to take a risk on. Now, of course, there are still programs in place for first-time homeowners. But the appropriate safeguards are in place to prevent a catastrophe.
While prices will come down again, expect to be waiting years. And even then, supply might not be able to meet demand as it has in years past.
BeachesMLS provides its clients with unique tools, resources, and goods that they need to be successful and react to market demands.
Invest in Florida Real Estate
When you invest in Florida real estate, remember that you're playing a long game. There is no quick route to homeownership in today's market.
However, when you decide to pull the trigger and invest in Florida real estate, it will be well worth the time and money. This type of investment can stay in your family for generations.
The housing market also has a strong history of returning value on investments over time, rather than depreciating. In a popular state like Florida, this will continue to hold true.
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