Purchasing a home in another country is a massive step. When most investors decide to buy real estate in Florida, they have some idea of what they will gain from the transaction. But is this always the case, and what actual benefits are there in owning a residence in one of the most populous US states?
Content:
- Visas to the USA when purchasing real estate
- Range of real estate in Florida
- Senior community in Florida
- Florida real estate investments
- Sale of real estate in Florida
- Home prices in Florida
- Florida taxes
- Living in Florida
Visas to the USA when purchasing real estate
The acquisition of real estate in Florida or any other US state does not affect an overseas buyer's visa status. It will be subject to the same rules as all other foreigners in the country. Specifically:
- the opportunity to stay in the country for up to 6 months on a B1 / B2 visa (for tourist or business trips, as well as for medical care);
- the right to apply for other types of visas, such as a visa for a valuable specialist to work in a US company;
- the opportunity to earn income from the acquired property by renting or reselling it;
- the right to enter into various real estate contracts, etc.
However, acquired apartments in Florida provide no additional benefits or advantages for obtaining a status other than the already existing one.
Range of real estate in Florida
Of course, purchased Florida housing can be viewed as a place of permanent residence. Apartments and detached houses, Florida's two main types of real estate, dictate different lifestyles and are preferred by different types of buyers. When selecting options, most real estate professionals in the United States provide the following table:
| Property type | Payments | What we have | Principle of choosing |
|---|---|---|---|
| Apartments in a condominium or apartments in a private property | The price of the apartment + the costs of maintenance of the common property | An apartment | First home or moving to a new place to reduce expenses |
| House | The price of the house + maintenance | A house and the area around it | Family housing |
| Townhouse | The price of the townhouse + the costs of maintenance of the common property | Part of a townhouse and the area around it | It seems like a home, but with less difficulties in maintaining the property |
| Apartments for rent | Rental payment and a deposit | None | In the case of not having enough money for a purchase or frequent travelling |
Since townhouses are not a common option in the local housing market, buyers usually decide whether to buy houses in Florida or condos. With all of the characteristics, it’s recommended first and foremost to pay attention to a residential property's geographical location, especially if the plan is to be a buy-to-let option in the future. If they are in a particularly good location, even small apartments can be more profitable and convenient than a large house.
Senior community in Florida
A distinguishing feature of Sunny State is the enormous number of senior communities. Accommodation options in specialised communities are plentiful due to numerous retirees who have finished working and want to relax on the luxurious beaches.
E.g., This is what The Village, one of the most popular "55+ only" communities in the state, has to offer:
- Community residents can participate in a rich programme of activities and entertainment for $189 per month, including golf, swimming, and walking comfortable routes, as well as fishing and numerous hobby groups.
- A wide variety of residences of various types and sizes for living, as well as apartments in multi-apartment buildings. E.g., a 133 m2 three-bedroom house can cost around $340,000. The monthly expenses for its upkeep will start at $ 800, with the entertainment and sports programme for $189 already included in this price.
Florida real estate investments
A lot of overseas buyers buy housing, particularly apartments in off-plan projects in Florida, as an investment asset, essentially to rent them out. This is a fairly profitable strategy, given the expected increase in rental prices in 2022. The median rent in the United States has been steadily rising since the beginning of 2021, only recently reversing this trend. It increased from a median of $1,897 in January 2022 to $2,053 in August, then, as expected, fell slightly at the end of the year to $1,979 in December.
The same figure for Florida was as follows:
- Florida ranks first in the average rental payments growth, with an almost 24% year-over-year rise.
- At the same time, rental payments in the state vary greatly depending on the specific location. E.g., in Miami, a one-bedroom flat in January 2023 will cost an average of $ 2,670, 14.1% more than last year. Rental payments for the two-bedroom apartments in Miami increased by 11.3% to $3,450.
- Meanwhile, the average rents in Orlando are lower, and the rate change isn't as significant: the one-bedroom apartments cost $1,680, up by 3.7% year on year, while the two-bedroom apartments cost $1,950, up by 5.4% year on year.
At the same time, the gap in housing prices between Miami and Orlando does not provide a definitive answer to the question of where it is more profitable to buy real estate - it still all depends on the specific offer.
Sale of real estate in Florida
The resale of acquired Florida real estate a year or two after purchase can be a very profitable transaction. E.g., in 2022, such an operation could cost up to 24% of the annual income, based on the difference in the average local housing prices between May 2022 and May 2021. Some counties "grew" faster than the state average:
- The average cost of housing in North Fort Myers, a separate settlement of about 42,000 people, rose by 62% in a year;
- Real estate in Sunny Isles Beach, due to the abundance of Russian immigrants known as "Little Moscow," increased about 50% in price;
- Prices in Coral Gables, a city of 50,000 people, also increased by 50%.
Currently, the price hike for apartments and houses in Florida has slowed slightly, but all the experts agree that, in general, Florida remains a state with ever-increasing property prices.
Home prices in Florida
The state's housing pLittlevary greatly depends on the location and condition of the property. Here are a couple of examples:
- A house in Tampa, Florida, one of the most popular among home-buyers, can be purchased for $395,000 on average. However, a 130 m2 three-bedroom house in the city centre can be found for $300,000 or even less. In this case, it will be situated in a less affluent neighbourhood;
- Even by Florida standards, Fort Lauderdale is an expensive city. At the end of 2022, the median price of a single-family home in this area was $528,000. These costs are justified by the high growth rates of real estate prices, which increased by 22.5% this year and will continue to do so in 2023. At the same time, a four-bedroom residence can be found here for $400,000. However, it will be located at a considerable distance from the beaches.
Florida taxes
Real estate ownership entails obligations in addition to rights. Of course, the most important aspect is the payment of taxes. The average property tax rate in Florida is 0.8%, with a notable local variation.
Here are a couple of examples:
- St. Lucie County has the highest expected tax rate -1.31% of the property value;
- Washington County has the lowest expected tax rate – approx. 0.56%;
- The median tax for the year 2022 in popular Miami-Dade County was $3,131, which is equal to 1% of the median home value of $310,700. In Jacksonville, the state's largest city, a homeowner will pay nearly as much, 0.97% of the house's value, a year. However, if the median home value is lower than $200,000, the tax is reduced to less than $2,000.
The last point clearly shows how important averages are and why it’s necessary to know in advance all the total for the yearly payments for a specifically selected unit.
Living in Florida
The most important benefit of purchasing a residential property in Florida is the ability to live in your own home in one of the most popular areas in the United States. With over 300,000 out-of-state Americans relocating here in 2022, Florida is ranked first in the country on this list. It's an interesting, enjoyable, and reasonably priced place to live. As we all know, locals do not specifically to undesirable areas. And, perhaps, it’s worthwhile to examine their behaviour patterns in this regard more closely.
