Opportunities abound for UK buyers in Florida, the Sunshine State
“The Florida market is resilient and is already coming back”. That is one conclusion in a new report on the Florida property market from Winkworth International Developments. The Sunshine State is predicted to attract significant attention from overseas buyers in 2010 looking for excellent value for money.
As the global recession eases and the recovery begins, experts are forecasting that investor confidence will flow back into the US real estate market and national house price declines are predicted to abate by early to mid 2010. New home sales should post an increase of around 20% from the very low levels seen in 2009.
Few real estate markets have suffered more than Florida, where oversupply has been a major factor in driving down prices. Foreclosures and a glut of unsold condominiums have especially contributed to slowing down the Florida housing market.
Charles Peerless, director, Winkworth International Developments comments: “Florida’s loss can be a UK buyer’s gain. With low prices on a wide range of top quality luxury homes and condominiums in world class developments, combined with a favourable exchange rate and low interest rates, buyers who seek sun, golf and wide ranging lifestyle attractions can now buy a home here for about half what they would have paid in 2005.”
“For international buyers, 2010 will be a great time to buy in Florida,” agrees Sean Snaith, economics professor and forecaster for the University of Central Florida in Orlando. “The imbalance of supply and demand puts the buyer in the driving seat. Large inventory, pricing power and the continuing weakness of the dollar when compared to other currencies mean awesome deals in the housing sector.”
Mr Peerless continues: “All this means that there has seldom been a better time to get into the Florida property market. According to most local experts, prices have nowhere to go but up and a home in Florida bought at today’s bargain prices should prove to be a laudable investment five years from now.”
For new homes, Florida’s construction sector bottomed out deeper than expected in Q2 2009, falling to just 35,352 housing starts at an annual rate. This level of starts represents only 12% of the peak number of starts it reached in Q4 2005 - a staggering 88% decline in starts from peak to trough.
The 2009 Florida Realtors’ Profile of International Homebuyers says that 14% of foreign buyers in Florida bought a new build, while the remaining 86% bought an existing property, which are.very similar percentages to the patterns among all homebuyers in the state. To take advantage of this trend, Winkworth International Developments will be launching a resale service in 2010 for UK buyers. The company is already active in the new homes market.
There are some pockets of Florida that have been affected more substantially by the downturn than others which now offer excellent opportunities to investors in high quality new developments. For example, in Orlando, buyers can pay $140 per square foot down from $250 in 2006 and in Sarasota prices that were $350 per square foot are now as low as $47.
South West Florida
This region of Florida enjoys relatively uncongested areas. It is sophisticated, less crowded than the east coast and there are some real bargains here.
Sarasota was recently highlighted on NBC as the number one place in the whole of the USA to buy a home. The city is known as ‘the Jewel of the West Coast of Florida’ because of its fine restaurants, beaches, theatres, arts, shops and lifestyle. Having seen a down market for prices in 2007 and 2008, Sarasota is now in full recovery mode. Prices are at 2002/2003 levels and the market between buyers and sellers is rapidly moving into equal balance. For the year to July 2009, the number of completed sales in Sarasota County showed an increase of 16.5 % over the equivalent period the previous year and pending sales showed a 57% increase on the same basis.
However, there has been little or no new construction in the area for four years, so high quality inventory is being snapped up.
Central Florida
With many beach properties, proximity to Universal and Disney World and significant growth along the 1-4 corridor from Tampa to Orlando, this area should experience a quicker comeback than most other areas in Florida.
Many developments are ideally geared towards the European buyer. For example, Victoria Woods at Providence, about 15 minutes south of Disney World, offers properties for buyers who want access to sports and lifestyle attractions with high rental yields. Prices range from $280,000 to $420,000.
Another development proving very popular with overseas buyers is Heritage Key Villas in Kissimmee, where 34 homes are available at under $200,000.
South Florida
South Florida is the place to buy a condominium. There are sales being made well below construction cost. The major reason for the decline in the Miami condo market is the difficulty in getting finance which tends to be more available on houses. As such, condos offer an excellent opportunity for cash buyers.
North Florida
North West Florida is dealing with many of the same issues as South Florida, such as overdevelopment and distressed property. Prices are discounted and are about where they were in 2005.
Florida has long been one of the top destinations for UK travellers, as well as overseas homebuyers, due to the easy access, value for money, use of the English language and guaranteed sunshine. Commenting on its enduring appeal among UK buyers, Charles Peerless concludes: “Buyers get so much more for their money in Florida than in Europe. Spacious high specification properties, spectacular golf communities, high future capital growth predicted, excellent transportation and, of course, the ever popular Florida lifestyle – sunshine, beaches, golf, cruises, theme parks, shopping and dining.”
For more information, visit winkworth.co.uk.
