Key West Trumps Miami for Real Estate Investing
Miami has been receiving a lot of media attention as a hot spot for investing in real estate lately but is this overshadowing some of the nation’s true gems, where investors can find more safety and a sunnier outlook for returns?
Certainly, Miami isn’t the only sunny market for buying a home or investing in property in the U.S. Despite a real estate recovery having officially been called and national statistics painting a picture of a gradually improving housing market many investors are seeing continued weakness in their local markets. New jobs numbers may be much improved and the amount of bank owned REOs on the market may be decreasing but foreclosures and mortgage defaults are still battering some markets and are holding them down.
So is Miami really the investment mecca it is being made out to be?
It is definitely true that Miami has seen a lot of improvement in the last year. Just as in a few other select markets like San Diego and Phoenix, local home prices are up, housing inventory levels are down and homes are selling faster. Rents are heading up in these cities too, making it more attractive to buy and producing higher yields for those investing for cash flow.
However, while Miami may be a fashionable place to own property and invest in real estate and potentially profitable if investors can get into the right properties could Key West actually be a stronger, healthier real estate market which makes a sounder investment?
Both Key West and Miami offer many of the same attractions. They are both famous vacation and second home destinations with an affluent international crowd. However, there are few spots in the world which can rival the fishing and diving, the laid back lifestyle and the amazing royal colored sunsets of Key West.
When it comes to the digits of investing in real estate Key West, Florida certainly has some major advantages, too.
In fact, Key West real estate has really emerged as its own asset class. Not being reliant on local buyers alone and attracting wealthy second home owners and investors from around the globe Key West, FL real estate is fueled by rich investors who see it as an excellent choice for safety of capital and income potential. Plus, of course, it’s always great to visit.
In comparison, despite improvement and positive signs Miami is still very much in the pit of the foreclosure crisis, with one in every 222 homes receiving a foreclosure notice in October according to RealtyTrac. That’s still one of the highest rates in the nation, where as Key West saw just one foreclosure in every 1,205 housing units in the same month. Miami’s housing market also remains largely dependent on the local economy and jobs, which have also been a big issue. Then there is a new building boom with thousands of new condos going up which will compete with investors and potentially soften the market.
In Key West, Realtors like Rudy Molinet, who has been recognized as the top producing Key West Realtor for the last three years in a row, point out that “homes sales here have not dropped below 2003 levels and home prices have seen high double digit growth over the last 3 years.”
So for those seeking a secure investment destination with great income potential it may well be worth taking a closer look at Key West, and with so much natural beauty, even if you don’t buy there the trip will certainly be unforgettable.