Like it or not, we’re still in the midst of a pandemic. This unique time has changed the dynamics of all facets of the business including the real estate sector. But not all changes have been negative–Florida’s real estate sector has remained quite busy despite the pandemic as people from other big cities, including NYC, look to the Sunshine State as a potential destination for future property investment.
Make no mistake about it – NYC Real Estate is still a hot commodity. But there has been a slight uptick in people relocating to Florida, New Yorkers included. There are a host of reasons for this shift. New York’s recently enacted rent control law is one of the main reasons.
Under this law, investors receive a much smaller return on their investments, which is one of the primary reasons they purchase the property. The effects of the new law were quick and drastic: demand for NY property fell nearly 20%. The new rent control legislation also removes incentives for potential investors to buy and rehab property since they can no longer control or increase the monthly without some level of governmental oversight.
As a result, many New York City investors are looking for investment opportunities elsewhere. And, since Florida is a non-regulated rent market that allows for maximum yield from an investment property, Florida has become the state of choice for many current and would-be NYC investors.
Since Florida is not rent controlled rental market, many investors are selling their properties in NYC and buying multi-family units in this state. In some cases, investors are even living in one of their available units so that they can manage them easily and yield maximum profit. And with plenty of sunshine and beaches, why not, right?
Property in South Florida cities such as Miami, Fort Lauderdale, and West Palm Beach offers nearly 123 opportunity zones alone. In addition, those opportunity zones boast nearly 25% commercial assets, which is super attractive to current and future investors.
Tax is another determining factor of why more investors are considering Florida as a hotbed for potential investment. Florida residents don’t have to pay a state income tax, a huge benefit for New Yorkers who are looking to invest in the state. The State of New York levies income taxes for residents in the 4 – 8.82% tax bracket. Overall tax rates are lower in Florida compared to New York.
NYC is one of the most developed and expensive cities in the world. Florida, by comparison, boasts a cost of living nearly half of NYC’s. That’s a huge difference.
Miami has seen a population boom over the last decade. With it has come to an increase of around 24% in the job market. And the momentum doesn’t stop there-available jobs means an influx of people from across the nation are relocating to the city and are in search of places to live.
You might be a great admirer of the NYC lifestyle, but Florida life is equally mesmerizing. Miami weather is ideal for anyone who loves being outside–it has some of the mildest winters around. Tourists from all over the world flock to soak up the sun on Miami’s beaches. The city’s diversity adds to its rich culture and cultural offerings in both food and entertainment. Talk about an investor’s paradise!
The real estate market in New York City tends to be more expensive and competitive than in Florida, with a higher demand for rental properties and a more limited availability of new construction. In Florida, the market is more diverse, with a variety of property types and price points available.
Advantages of investing in real estate in New York City include a high demand for rental properties, the potential for strong rental income, and the city’s status as a global financial and cultural center.
Advantages of investing in real estate in Florida include lower property prices and taxes compared to New York City, a growing population and economy, and a variety of property types and locations to choose from.
The risks of investing in real estate in both areas include market volatility, changes in interest rates or tax policies, and the potential for natural disasters or other unexpected events that can impact property values.
In New York City, popular types of investment properties include rental apartments, condos, and commercial properties. In Florida, popular types of investment properties include single-family homes, vacation homes, and rental properties in tourist areas.
The future of Florida real estate looks promising due to factors such as population growth, low taxes, a strong job market, and a desirable climate. However, factors such as climate change and potential changes to tax laws may also impact the market in the future. Overall, Florida’s real estate market is expected to remain attractive to both domestic and international buyers.
Don’t sleep on Florida–it offers dozens of appealing features for prospective investors. It’s definitely a locale to consider if you’re considering an alternative to NYC’s real estate market. It’s certainly warmer.