When Kenneth called me up to ask where he could find investment property in Florida for the coming year, I was more than a little surprised. I never thought of my brother-in-law as the real estate investor type. I don’t mean to imply that he doesn’t have a solid work ethic, because he does.
But, he’s been at the helm of his own company in Gainesville for a couple of decades now but it has nothing to do with investing or real estate. So, I just assumed buying and renovating properties to sell was not up his alley. That goes to show you how even an investing old-timer, like me, can still learn a thing or two.
In fact, once we really got to talking, Kenneth explained that he’s always been curious about investing. He’s just never had the time to seriously think about where he might want to buy Florida real estate investment property or how to go about doing it. Now that the kids are out of college and starting their own careers, however, he’s got more time and is willing to take bigger risks. And, he admitted, it helps that I’ve been successfully buying investment property in Florida for many years. So, he’s got the perfect brain to pick now that his timing finally feels right.
Where to Find Hot Real Estate Investment Opportunities in Florida
Personally, I always think it’s a good time to become a real estate investor—especially here in the Sunshine State. But, I get why a lot of would-be investors, like Kenneth, hesitate. It’s not always so much about the local real estate market. It’s often about personal timing and whether the risks involved are seen as more easily weathered.
That’s why, given the chance, I always tell new investors that though there are risks to investing in residential real estate, these can be mitigated with a little bit of know-how, a whole lot of elbow grease, and the right investment opportunities. Of course, insight into the local market can be a source of power as well. And, Florida’s investment market is a hot one to look into.
There are several reasons why Florida is a great place to park your real estate investment dollars. Florida’s economy is stronger than ever. Though largely driven by tourism, the agricultural, aerospace, and financial services sectors collectively provide millions of jobs to Floridians throughout the state. And, the availability of these jobs, along with Florida’s relatively low cost of living and beautiful year-round weather, have helped to attract more transplants in recent years than most other states. This, in turn, has contributed to an overall increase in the demand for housing—and more investment opportunities to meet this need.
And, with Florida repeatedly ranking as one of the top states in which to start or grow a business thanks to a lower-than-average tax burden, it’s reasonable to expect that the economy, and the job and sunshine-seeking population, will continue to expand.
This ongoing expansion will likely accelerate the existing demand for housing. Median home sales prices already pushed upwards to $259,000 in response to higher homeownership demand this year, even with the slight uptick in inventory from last year. So, as a Florida investor who buys and sells houses as a business, it’s possible to meet both current and future demand while building your investing career as long as you invest in cities where the market is sure to stay hot.
As a longtime investor here in the Sunshine State, I can certainly point you in the right direction. Here are the cities where real estate investment opportunities in Florida are bound to keep getting warmer in 2020:
Yes, Orlando has topped a few lists in its time as one of the best places to buy rental property, but its small southwest neighbor, Kissimmee, should top your list as a great spot to buy, renovate, and sell or hold homes. With more renters than homeowners in this Lake Toho-side town, it certainly makes sense to get a few rentals under your belt and into your portfolio—especially if you can secure a good cap rate. But, with median home list and sales prices floating upward year after year, you could also realize solid returns should you decide to sell.
Either way, the possibility that the number of people who want to rent or buy in Kissimmee could easily go up in 2020. Between 2010 and 2018 alone, the number of residents in the city grew by more than 23%, according to the U.S. Census Bureau. That’s 10% more than the population growth rate for the entire state.
And, since the cost of housing still averages less than even nearby Orlando, those on a fixed income, like retirees and veterans or families on a budget, could find Kissimmee an affordable option. If you are the one who supplies them with good housing options, you’ll have more than one way to build a great investing business.
Though the state of Florida was one of the hardest-hit by the housing crisis more than a decade ago, Gainesville was arguably one of Florida’s hardest hit cities. Not only were foreclosures and short sales piling up in record numbers, local residents were moving out in droves—some outright abandoning the homes they could no longer afford. This made the road to recovery look long and arduous. At times, it even seemed unlikely.
But, Gainesville surprised everyone by getting back on the horse just a few years later, hitting a steady stride that hasn’t eased up or tired out since. Employment opportunities increased, which helped to stall foreclosures and entice the return of new buyers. The housing market buoyed as a result. Now, unemployment is lower than the national average as is the total number of foreclosures. And, median home sales prices? They’re still trending upwards by almost nine percent year-over-year.
Gainesville’s appeal isn’t expected to slow anytime soon, either—especially with local job growth putting homeownership within reach of many would-be buyers. This gives you an opportunity to grow your Florida real estate business in the coming year, too, as long as you’re able to buy investment properties in Gainesville at below-market prices to rehab then sell at or above market rates.
Buying, renovating, and selling homes in the state capital of Tallahassee may give your investment business—and your bank account—a nice boost as well.
A record-breaking rate of low unemployment thanks to a better-than-average growth rate for jobs landed home affordability squarely in the hands of Tallahassee residents in 2019. But, the rate of local homeownership had already been on the rise for several years. And, it may continue to rise as job seekers keep moving to town to take advantage of Tallahassee’s growing reputation as Silicone Valley South—and the high earning potential that modern tech jobs bring with them.
Already, demand for the area is so strong that Tallahassee is considered a seller’s market. Median list prices are up by nine percent year-over-year, time on the market is down to less than 60 days, and sellers are getting the prices they want.
Though that may make it sound like it’s a tough market to break into as a real estate investor, your goal isn’t to buy single-family homes on the open market anyway—only to sell them there. So, provided you can buy properties off-market and keep your rehab costs in check, you should see your 2020 returns trend upward as well.
The housing market in Sarasota is considered a more balanced one, indicating that the supply of homes corresponds to the number in demand. And, that’s pushed median days on the market up slightly from last year to just over 100. But, it hasn’t stopped median home list prices from going up 4.5% year-over-year nor has it caused sales prices to really drop. In the last year, they’ve actually stayed quite stable. And, if you pull back and take the long view of Sarasota’s housing market, you’ll see that sales prices have steadily gone up.
These facts give you the opportunity to make two different investing plays in Sarasota, both with potentially lucrative outcomes—particularly when you consider that there are about an equal number of owner-occupiers and renters in the area.
As always, with a lead-generation strategy in place that helps you find off-market properties, you can buy homes inexpensively then fix them up to sell for good returns. And, if you buy low enough, pricing the house competitively so that it sells in less than three months is possible, too.
But, you may also want to consider purchasing properties to hold as rentals in Sarasota. Just finding good tenants—then finding ways to keep them—is enough to make some investors question whether being a landlord is worth it. The pros can outweigh the cons, however, when your passive income stream starts filling up your pockets. Then, if and when you want to sell later, you can wait for the city’s slow-and-steady market climb to reach the peak that works best for your bottom line.
Unlike Gainesville, the foreclosure rate in the Lakeland area is higher than the national average, though pre-foreclosures are on the overall decline. Unfortunately, in the city itself, foreclosure filings are still high—clocking in at about one in every 1,373 homes.
Of course, that doesn’t touch what Lakeland experienced during the housing crash. But, because unemployment is low as is the cost of living compared to Tampa to the west, it’s hard not to wonder why some residents are having a hard time making ends meet.
The answer may lie in the fact that seniors, who make up a large segment of the city’s population, may be struggling with the rising cost of Lakeland’s housing. And, the cost to live in Lakeland is going up thanks, in part, to the influx of new residents who actually find the city more reasonably priced than those further up north or along the west coast. It certainly doesn’t hurt that Lakeland often makes the media rounds as one of the best American cities to live in or retire to.
Because the demand for owning a home in Lakeland is on the rise, median home list prices are up as well—by 9.5% year-over-year. And, sellers are getting more than 98% of asking. So, chances are strong that, as long as you correctly calculate all of your numbers, the returns when you sell will trend upward, too.
If you can also reach the homeowners who can’t pay their bills before they find they’re in foreclosure, the opportunity to keep your purchase price low and the hope of a distressed homeowner high are even better.
It’s critical to keep in mind, however, that even when you know where to find the best places to invest in Florida, you still have to know how to locate good deals there. It’s not always obvious just by driving around up-and-coming neighborhoods or using other traditional lead-generating strategies, like lead lists. In fact, the kind of deals that have the potential to produce the greatest returns are going to come directly from distressed homeowners no matter where they live. Usually, they need to sell fast, too.
So, how do you help motivated sellers find you? By picking an established Florida investor’s brain, like mine, of course.
How to Find Great Florida Deals This Year and Every Year
At this point in my career, I really should know better when it comes to making assumptions about who is going to make a great real estate investor and who isn’t likely to even try. One of the things I love about this business is that people from all walks of life have an equal chance of succeeding, no matter their background, level of education, or previous work experience. Once you’re trained in buying and renovating properties to sell or rent out, all you really need to get started is a strong work ethic, like Kenneth’s, a passion for real estate, and a way to find deals.
And, as far as finding deals on Florida real estate investment property, I’ve got you covered. If you become an independently owned and operated HomeVestors® franchisee, like me, you’ll gain immediate access to the kind of marketing tools and resources that generate leads on homeowners who are motivated to sell fast—all year, every year. These tools, like the nationally recognized “We Buy Ugly Houses®” ad campaign, are so effective, in fact, that franchisees have bought more than 100,000 houses nationwide since franchising began in 1996.
So, if the timing is right for you to start investing, too, it’s never been a better time to get your hands on some great proprietary tools—and join the HomeVestors team.
To gain immediate access to qualified motivated home seller leads in all of Florida’s most promising cities, call HomeVestors. Opening a Florida franchise today can open doors to better investment opportunities tomorrow.