For the 14th consecutive year, Florida remains the most popular destination for foreign buyers in the United States, attracting the attention of 24% of all international real estate investors. California ranks second with 11%, followed by Texas in third with 8%. The Sunshine State is popular with both investors and those looking to relocate permanently. In this article, we will explore the most sought-after cities and locations for foreign real estate purchases in 2023, as well as the purposes behind acquiring property in Florida.
Content:
- What makes Florida an attractive place to live
- Financial indicators in the real estate sector
- The most attractive places to buy real estate in Florida
- Let us help you buy real estate in Florida!
What makes Florida an attractive place to live
The state is known for its relaxed and tranquil atmosphere, often considered one of the most pleasant places in the US. Despite a well-developed commercial and trade sector, tourism remains the primary economic driver in Florida. The state is home to several major theme parks, including the world-famous Disney World.
The feeling of a real vacation can be found in every corner of Florida. Whether sipping coffee in a cozy café or strolling along beautiful sandy beaches, the state's lifestyle is distinctly different from other parts of the country.
South Florida, including Miami-Dade, Broward, and Palm Beach counties, boasts a well-developed infrastructure with two international airports and two major cruise ports. The location offers numerous tourist attractions and year-round beaches. Thanks to the warm Gulf Stream currents along the coast, ocean swimming is possible even in winter.
Other factors that make Florida an attractive state include:
- Plenty of entertainment options, including theme parks, boating and golf. Although popular with retirees, Florida offers something for all generations.
- Tax advantages. The absence of income tax is a significant advantage for foreign buyers. In addition, Florida has low property taxes, with an annual rate of only 0.86%.
- Multicultural atmosphere. Florida's diverse population makes it especially attractive to foreigners. Miami Beach, for example, is home to a large community of immigrants from all over the world.
- Investment potential. Florida's real estate market demonstrates stability and consistent growth, making it an attractive option for rental and resale.
Financial indicators in the real estate sector
About 76% of foreign buyers prefer to invest in single-family homes or townhouses. For 50% of out-of-state buyers, the primary motivation for purchasing a property is the opportunity to use it as a vacation home, rental property, or a combination of both.
The resurgence of Florida's housing market after the 2008 crash has made the state one of the most profitable places to invest in real estate in the U.S. Over the past five years, home prices have increased by an impressive 81.7%. The current median home price is approximately $407,000, up 27.8% from last year.
Employment growth, a key factor in housing demand, has reached 5.1%, while the population has grown by more than 21 million people. Many are opting to rent, and the current apartment occupancy rate is over 93%, resulting in annual rental price growth of up to 55% in some areas.
The most attractive places to buy real estate in Florida
Let's explore the most popular locations in 2023.
Tampa
The average cost of a home in Tampa is $430,000. The city also boasts a high economic growth rate of 4.7%. The median rental income in Tampa is $2,300 per month. The median year-over-year increase in home prices is 25.4%. The average property tax rate is 0.91%.
Known for its world-class beaches and low cost of living, Tampa has long been considered one of the best cities in the U.S. for real estate investment. A stable job market continues to support the growth of this large city of nearly 396,000 residents, resulting in high demand for rentals as housing supply is limited.
Rental prices have increased more than 20% over the previous year. 2-bedroom apartments in Florida are the most popular, but 3-bedroom apartments consistently contribute to the growth in rental rates, averaging $2,399 per month. Central areas of Tampa and McFarlane in the northeast offer higher returns, with average rental costs reaching $3,325.
Orlando
The average cost of a home in Orlando is $395,000. The city's economic growth rate has reached 4.2%, and the employment rate is 63.7%. The median rental income is $2,101 per month. The median year-over-year increase in home prices is 25.8%, and rental prices have increased 23.5%. The average property tax rate is 0.89%.
Known as the theme park capital of the world, Orlando is home to popular entertainment parks such as Disney World, Sea World and Universal Studios. The city's population has recently grown by 30%, with a 4.2% increase in employment opportunities. The tourism sector has experienced a growth of 114.7%. 63% of Orlando's real estate is occupied by tenants.
Despite a 23.5% increase in average rental rates compared to 2022, the occupancy rate remains stable at 90.5%. Rentals costing more than $2,000 per month make up 40% of the market, with 2-bedroom apartments being the most popular.
Jacksonville
The average cost of a home in Jacksonville is $321,000. The economic growth rate is 4.6% and the employment rate is 59.9%. The median rental income is $1,350. The median year-over-year increase in home prices is 24.6%, and the median year-over-year increase in rental prices is 19.6%. The average property tax rate is 0.90%.
Jacksonville is one of the fastest growing cities in the country and offers relatively affordable housing. For example, a home can be purchased for around $321,000, which is very attractive in the US. In addition, the apartment occupancy rate is 93.4%, indicating a high demand for real estate in the city.
In the rental market, the average cost is $1,350 per month. However, it can approach $2,000 in central areas of the city. Despite the limited supply of housing, nearly 59% of homes sold below the asking price last month. It's worth noting that there are properties on the market priced under $200,000, with rents ranging from $1,300 to $1,800.
Miami
The average cost of a property in Miami is $589,000. The economic growth rate is 2.1% and the employment rate is 60.4%. The average rental income is $3,700 per month. The median year-over-year increase in home prices is 29.4%, and the median year-over-year increase in rental prices is 24.4%. The average property tax rate is 0.90%.
As more people move to Miami in search of low taxes and a warm climate, home prices will continue to rise. Over the past 10 years, real estate prices in the city have nearly doubled.
About 70% of Miami's real estate is rented. The average cost of villas in Florida is about $589,000, but the rapid increase in prices and rental fees will quickly justify the expense. Rental fees range from $2,100 to $6,500 per month, with 4-bedroom apartments yielding the highest profits, up to 30%.
Let us help you buy real estate in Florida!
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