The trend for investment in Florida is in the midst of a game change, as single-family home opportunities create a double dose of profit possibilities for buyers.
At the close of 2012, there were still 300,000 foreclosed homes and an additional 250,000 bank owned properties in the state of Florida. This enticing opportunity for investment has resulted in a surge of buyers in recent months, with sales of homes such as these up by 25%; however, in many cases, it is not individuals purchasing the properties but large private equity investment groups. In total, these sales account for at least 4,000 sales across Florida.
In the history of Florida's real estate market, never before has there been such an incursion of single-family homes by large-scale investment firms; however, it appears that the companies all share a common strategy. Rather than purchasing properties as a long term investment and profiting at the point of sale further down the line, investors are now expecting to also profit from the rental market in the meantime.
On average, investors can expect returns of 6%-8% on single-family rental properties in Florida, but some areas of the state have seen this rise to as much as 12.4%. This is among the highest percentage rental returns in the whole of America.
Lewis Goodkin, who is a Miami-based real estate analyst, explained that 'condo vulture' investors who bought condo units at low prices a couple of years ago did not anticipate making money from renting them out; their intention was simply to make a profit by selling the units at a profit when the prices rebounded.
This growing trend has come at a time when evidence suggesting that now is the time to invest in property in Florida is abundant.
