Investing in Florida Real Estate: A Complete Guide

The sunshine state has been a goldmine for real estate investors throughout its history. From its white sandy beaches to its bustling urban centers, Florida is the place to be for any investor that wants to make a living in the real estate market.

Home to the fourth largest economy in the US, Florida exhibits many key indicators for prime real estate growth. The state has experienced rapid expansion since the 2008 financial crisis, has a low unemployment rate, and is stocked with various attractions that make it one of the most popular tourist destinations on earth.

Read on for a full rundown on the Florida real estate market, including the following topics:

The draw of the market
Where to invest in Florida real estate
Top tips for investing
Partnership opportunities

Florida Real Estate: The Draw

Florida has several unique characteristics that make it an ideal location for real estate investing.

A Growing Economy – Florida has experienced continued year-over-year economic growth, a competitive job market, and a comparatively low unemployment rate to other US states. All of these factors have resulted in a lucrative, growing real estate market—especially in residential properties.
Population – The state’s population is rapidly increasing. In other words? The demand for housing in Florida is increasing with its population. As more people look for homes and properties become scarcer, the value of those properties will continue to appreciate overtime.

Booming Industries – Many of the most profitable industries in the country call Florida their home. The state is known for its theme parks and sunny vacation destinations, but also retains major companies in the healthcare, banking, and aerospace sectors.
Renting is Popular – Renting is the main source of housing for Florida residents. This presents a great opportunity for real estate moguls to invest in single-family homes or multi-family properties aimed at renters. If you’re weighing out the benefits of investing in commercial vs residential real estate, the lucrative Florida rental market is the true draw to investing in residential.

A Multitude of Locations to Choose From – With 23 municipalities of over 100,000 residents, there are a plethora of options available when choosing to invest in Florida real estate.

Tax Breaks – Florida has no income tax. That incentive alone makes this state a prime location for investment opportunities and an ideal place to call home.

While these impressive dynamics make the entire state of Florida an attractive destination for real estate investment, each individual region has its own unique advantages.

The Top 5 Florida Locations for Investing in Real Estate

There are specific regions within Florida that offer enhanced opportunities for real estate investment. Let’s take a look at five of the top locations.

1. Fort Lauderdale – Average Rent $2,100 – Median Price of a Home $320,000

Not far from the famous Miami coast, Fort Lauderdale may be Florida’s biggest real estate draw. For one, there is very little space left for new developments, which has resulted in significant year-over-year price growth.

Additionally, the city has one of the highest job growth rates in the state, making it a destination for both renters and buyers. If you are looking for a great place to invest, Fort Lauderdale is a sure bet for continued growth for years to come.

2. Jacksonville – Average Rent $1,100 – Median Price of a Home $165,000

Sitting peacefully on the Northeast coast of Florida, Jacksonville is a great city for both investors and residents alike. Not only is it considered one of the fastest-growing Florida cities, but it also has the metrics to support lucrative real estate returns, including:

Over 5% annual population growth since 2016
Over 4% year-on-year job growth
More than 9% annual increase in house prices

If those numbers continue, investors who capitalize on purchasing property in Jacksonville will be happy they jumped into the market early. And to get the most out of an investment in this city, consider seeking out property management in Jacksonville, FL to help you run your rental property smoothly and keep tenants happy.

3. Tampa/St. Pete – Average Rent $1,800 – Median Price of a Home $175,000

The Tampa Bay and Saint Petersburg area boasts a bustling population center with a major sports franchise and a booming economy. The majority of the population resides in single-family properties. This metropolis is a growing real estate hub, in fact, it’s considered one of the best places to buy rental property.

Anyone looking for a high-growth urban center that has an economy suited for rental investments should put Tampa and St. Pete at the top of their list. And if you’re looking for property management in Tampa, you have Great Jones to help with that.

4. Orlando – Average Rent $1,300 – Median Price of a Home $185,000

The home of Disneyworld and an array of other tourist attractions, Orlando is yet another Florida real estate investment center. While you would be forgiven to assume that tourism is the bread and butter of this Central Florida community, that’s actually not the case.

Thanks to various companies moving into the city in recent years, Orlando has experienced a remarkable tech boom. This has only increased its real estate potential, making it an attractive location for further investment. Due to the increased interest in this city’s potential, professional Orlando property management is a must for keeping your rental property in tip-top shape and running smoothly against other competing rental properties.

5. West Palm Beach – Average Rent $2,600 – Median Price of a Home $250,000

You can find some of the most beautiful beaches in the entire state (or even in the entire country) in West Palm Beach. You’ll also find some incredible prime rental investment opportunities. Whether you are looking for long-term renters or vacation potential, this relatively small (110,000 residents) urban center has it all.

Despite a low rate of population growth in the area, average income has risen more than 5% a year. This has created a lucrative real estate market, even without considering vacation rentals. All of these intriguing factors mark this beautiful seaside city a unique place to invest, leading to an increased demand for West Palm Beach property management to help maintain a smooth-running rental property.

Tips for Investing in Florida Real Estate

While there are always commonalities between locations, there are some important criteria worth considering prior to making an investment in Florida. Here are four tips to consider before entering the Florida real estate market.

1. Know Your Regions

Each region within Florida has its own real estate dynamics worth contemplating. So before making the leap toward investing in the state, think about the following variations between each region.

Northwest Florida – Far from the tourism centers that make the state famous, the Northwest is perfect for investors looking to flip homes or invest long-term in affordable properties. Renting here is less common than other parts of the state. Keep that in mind if renting is a part of your long term investment plan.

Northeast & Central Florida – Tourism is the major business in Central and Northeast Florida, creating an ideal location for investing in vacation and rental properties. But you won’t be limited to the renter’s market. Thanks to the various industries based in Northeast and Central Florida, there are plenty of options to diversify your real estate portfolio.
Southeast Florida – From Miami and Fort Lauderdale to West Palm Beach, Southeast Florida has it all. The area is home to some of the state’s most luxurious properties, but also holds a wide range of investment options. Competition is high in this part of Florida, so be sure to conduct your due diligence before springing for a big purchase.

Southwest Florida – The Gulf Coast offers similar potential as the Southeast in a more reserved, laid back atmosphere. Vacation rentals and retirement houses are popular in this part of the state, with a large number of wealthy individuals residing in the region.

2. Try to Combine Affordability with Growth

Just like any other entrepreneurs, real estate investors look for high-growth potential combined with limited risk. Florida real estate is driven by this factor.

When determining where, when, and how to invest in Florida real estate, look for locations that have yet to experience price hikes and have a solid renting population. This will enable you to receive maximum returns while capitalizing on Florida’s high-growth economy.

3. Know Your Rent Prices

The costs of renting a single-family property in Florida differ widely across regions and even within single communities. For this reason, it’s essential to know your rental prices before committing to a rental investment.

While this consideration might be a given, it’s crucial for investors to understand the reasonable monthly returns before committing to a major deal.

4. Understand the Demographics and What They Want Out of a Property

Everyone knows that Florida is a retiree’s paradise. However, don’t assume you should tailor your real estate investments to meet the needs of an older demographic. Florida is a diverse state with an array of consumers looking for homes.

Make sure that you carry-out the proper market research before modifying your properties—you may discover some surprising opportunities.

Great Jones – Your Property Management Partner

Due to the diverse nature of Florida real estate, many property investors opt to go with a property management company to facilitate the process of renting and leasing homes to vacationers, families, and individuals across the state.

At Great Jones, we are your ultimate property management partner. Not only do we have a complete understanding of the varying dynamics of each regional real estate investment market within Florida, but we also have an on-the-ground team ready to meet your needs in every corner of the state. For more valuable information to keep in mind for a rental property in Florida, check out our step-by-step guide on the Florida eviction process and the latest news on rent control in Florida.