I hear this question daily, all that shines is not gold so please let me outline my view of the Florida property market.
A new build 900 sq ft 1 bedroom sea view condo in Miami cannot be measured against a 15 year old timber frame 550 sq ft 1 bedroom/studio in Ft Myers. It is essential to measure apples against apples.
It seems obvious when phrased like that, but it isn’t stopping both amateur and professional investors of falling into the trap. Whether property prices are increasing, stagnant or falling – you still tend to get what you pay for.
Picture the town / city / village where you currently live and imagine there are many distressed sellers. Would your first reaction be to hunt down the very cheapest property available just because it is cheap and tenanted? I’d imagine the answer for most of you is no, and that many would prefer to pay a little extra to get a discounted property in a nicer part of town, where the tenants are solid and a resale market can be clearly visualized. This is how we feel about Florida.
Not everybody takes this approach. Over the last few months I have seen UK and Irish agents engage in what I can only describe as a “race to the bottom”. There is real pressure in this business to source the very cheapest distressed deals possible with scant regard to the ABC’s of smart investing.
It’s a pretty risky strategy for an agent to engage in, and it is not one that would be of interest to Torcana. No doubt the commission will come rolling in for a few months, but these agents will quickly reach a point where they either have to ignore large numbers of client complaints or they will have to dedicate ruinous amounts of company resources to solving messy aftersales issues.
It is our view that investors should not be satisfied with an agent who just sources property. A good agent is an essential service for a non professional as they help him/her (a) find the smartest long term investments available, (b) ensure the pitfalls of buying in a distressed market are avoided and (c) assist with a smooth transfer of ownership.
Looking forward to your thoughts.
Kind Regards
David Shaw
Torcana Sales Manager
Tags: distressed property, Florida Property Investment, House price statistics, Torcana
