Many real estate investors say that location is everything when it comes to purchasing a real estate investment property. Properties that are located in cities of consistent growth are more likely to perform better than investment properties in depressed cities, which brings us to the topic of this article – the Florida real estate market.
The Florida housing market has been topping lists for the best markets in the US for several years thanks to the relatively low property prices and a friendly real estate investing environment. Keep on reading for the latest real estate market trends in the Florida housing market and to find out which 3 cities will come out on top for 2019.
Related: What to Consider Before Buying Property in Florida as a Real Estate Investment
Why Invest in the Florida Housing Market?
There are many reasons that make the Florida housing market one of the best in the country to invest in real estate. The state’s beautiful nature, demographic growth, and friendly business climate contribute to the strength of the Florida real estate market. Additionally, Florida’s strong economy maintains a low level of unemployment (3.8% compared to the national level of 4%), which is essential for a strong housing market.
Related: Is Early 2018 the Right Time to Buy House in Florida to Invest in Real Estate?
One of the many reasons that real estate investors choose Florida to invest in is its rental laws. Florida is considered to be one the most landlord friendly states in the country with loose rental laws that make the housing market attractive to real estate investors. With no rental control laws and practically no Airbnb legal issues, owning a vacation rental property in Florida could be your next real estate investment!
In the yearly PwC report, “Emerging Trends in Real Estate,” Florida has earned three places in the top 10 markets to watch, with Orlando in the top five and Tampa Bay/St. Petersburg in the top ten.
Top 3 Cities to Invest in the Florida Housing Market
#1 Orlando Real Estate Market
The Orlando real estate market is attracting more real estate investors and people who choose to move there. Thanks to its picturesque beaches and high quality of life, Orlando is proving to be a secure real estate investment location for local and international real estate investors alike.
The Orlando real estate market is buttressed with a low unemployment rate of 2.9% and a population growth of 3.2% since last year. These important economic indicators are proof of a healthy real estate market.
Data from Mashvisor’s investment property calculator shows that the average property price in Orlando is $323,836, slightly above the Florida median home price of $289,900. Additionally, the Orlando housing market prices have appreciated 6% since last year, making it one of the top 3 cities to invest in the Florida housing market in 2019.
Related: Orlando Real Estate Market 2018: Wondering Where to Invest?
The following are the latest Orlando real estate market stats according to data from Mashvisor. It is important to point out that cap rate and cash on cash rate are equal since our investment property calculator assumes that an investment property is financed out right in cash. However, when looking for properties using the investment property analyzer, you can change the method of financing for a more accurate cash on cash return.
Give the calculator a try here.
- Median Property Price: $323,826
- Price per square foot: $172
- Airbnb Rental Income: $2,256
- Traditional Rental Income: $1,588
- Airbnb CoC Return: 2.96%
- Traditional CoC Return: 1.73%
- Airbnb Cap Rate: 2.96%
- Traditional Cap Rate: 1.73%
- Airbnb Occupancy Rate: 59.46%
#2 Tampa Real Estate Market
Next on our top Florida housing market list comes Tampa. Tampa real estate is gaining popularity due to a strong local economy, rapid population growth, and a low unemployment rate of 3.4%. Thanks to its strong and diverse economy, the Greater Tampa Bay area is ranked among the fastest growing metro areas in the US, which goes hand in hand with a boom in the real estate market with billions of dollars of investments in residential and commercial real estate. Because of Florida’s lax rental laws, Tampa has become one of the hottest cities in Florida to own a rental investment property.
The latest Tampa housing market trends obtained from Mashvisor show that on average, Tampa investment properties cost $361,876 and generate $1,669 for a traditional rental and $2,572 for an Airbnb rental property. From these numbers, we can conclude that investing in Tampa real estate is more promising than other cities in the Florida housing market. For example, Miami real estate properties have a median price of $657,903, which is much less affordable.
- Median Property Price: $361,876
- Price per square foot: $190.10
- Airbnb Rental Income: $2,572
- Traditional Rental Income: $1,669
- Airbnb CoC Return: 3.76%
- Traditional CoC Return: 1.92%
- Airbnb Cap Rate: 3.76%
- Traditional Cap Rate: 1.92%
- Airbnb Occupancy Rate: 52.92%
To start looking for and analyzing the best investment properties in Tampa, click here.
#3 St. Petersburg Real Estate Market
We cannot talk about the Florida housing market without mentioning St. Petersburg. Following the same real estate market trends in Tampa city, St. Petersburg real estate market remains a strong destination for real estate investors and homeowners.
- Median Property Price: $387,119
- Price per square foot: $225
- Airbnb Rental Income: $2,036
- Traditional Rental Income: $1,661
- Airbnb CoC Return: 2.4%
- Traditional CoC Return: 1.86%
- Airbnb Cap Rate: 2.4%
- Traditional Cap Rate: 1.86%
- Airbnb Occupancy Rate: 55.08%
The Bottom Line
The Florida housing market is ready to enter 2019 with a strong profile, continuing the trend of the last couple of years. However, real estate investors are advised to look more thoroughly inside a real estate market. Before you decide to invest in Florida or anywhere else, it is important to conduct a real estate market analysis. A market analysis will provide you with more information about the current supply/demand equilibrium and will help you establish a price for your chosen rental property.
Mashvisor’s property finder and investment property calculator can help. To start your 14-day free trial with Mashvisor and subscribe to our services with a 20% discount after, click here.
