Many of our past guests on the show have referenced the Jacksonville real estate market in their lists of rising, hot Florida markets. The area has been making a steady recovery since the economic recession and investors are taking notice. With a stable economic base and opportunity in a variety of asset classes, the Jacksonville real estate market has a lot to like for investors.
Maxwell Lee and Kelly Lei, of Glocal Network, know firsthand the appeal of the Jacksonville real estate market. Two years ago, Kelly and Maxwell both left traditional, W-2 income careers for a life in real estate investment and started Glocal Network, a real estate investment firm based out of Jacksonville. Though the company is young, they have a combined portfolio of individually owned and partnered investments of over 20 properties in a diverse collection of asset classes. Kelly’s brokerage and agent’s license combined with Maxwell’s hometown knowledge of the Jacksonville real estate market have established Glocal Network as a leading investor in the Jacksonville real estate market.
Jacksonville Real Estate Market
Large amounts of single family foreclosure properties still being released
40th largest metro in U.S., with strong growth potential
Strong single family markets: Riverside; Avondale; Springfield; San Marco
One of the downsides for real estate investorsbuying single family homes has always been the large amount of time and financial investment it takes to certify an asset. Buyers most conduct thorough due diligence to verify a property’s physical condition, legal standing and yield potential. Buying single family homes can be a stable financial option, but it requires a lot of personal commitment that some investors just can’t afford.
Roofstock may provide investors with a solution to this problem. This episode, RoofstockCEO Gary Beasley stops by to talk about the new platform that is changing the way investors are buying single family homes. By removing the stress and mess of the due diligence process, Roofstock can greatly decrease transaction fees and increase market fluidity by providing investors with a certified, reliable and transparent marketplace for buying single family rental homes. They are also proving that buying leased single family homes can be a greater asset than vacant singe family properties.
Launched in FL – Tampa, Orlando, Cape Coral, Jacksonville, Miami
Also Atlanta and California
Grow to 10+ markets in U.S.
3rd party valuation report, title report, property inspection, rent surveys, financial calculator est. returns based on several rental situations, vets tenants and property managers
Buyer freed from operational component of investing
Buyers able to rely on surety of data
Cheaper, More Effective than MLS
Roofstock – 2.5% transaction fee from sellers; .5% marketplace fee from buyers : MLS – 6% transaction fee
Standardized marketplace of available, leased single family homes
Investment fund opportunity
Recent launch of 100-property fund
Provides readily available market for investors in need of exchange property
To find out more about the great services Roofstock offers investors buying single family homes, check out their website! You can also contact Gary directly at email@example.com or the senior client adviser, firstname.lastname@example.org
Successful real estate investing requires knowing the terrain. Investors need to play the field and work hard to find the right deals. Florida real estate markets are garnering a lot of interest from investors and asset classes across the board are becoming more competitive. An investor starting out in single family can become full-time institutional real estate investor with strategic planning and a strong capital base.
Greg Williams, Co-founder and Principle at Cardinal Point Management of Tampa is a true testament to this fact. Greg was introduced to real estate investing out of college. After 4 years of experience building in a variety of asset classes as part of investment firms, Greg set his sights on becoming an institutional real estate investor in the Florida real estate market, focusing on. Though he started small, Greg aspired for larger more diverse deals. Bringing a competitive spirit and strategic approach, Greg maneuvered Florida’s real state industry and has become a success story as a leading institutional real estate investor.
Cardinal Point Management
Drawn to Tampa’s diverse commercial opportunity
Began small, raising capital through family and friends
Full-service development, management and brokerage investment firm
1st Institutional Lender Deal
Retail center, S. Tampa, 22k sqf, 95% occupancy
Purchased at $255/sqf on non-recourse loan through mortgage broker (Jermey Pino); 8.25-8.5% cap rate; $5.3 million total
Sold in March, 2016 for $10.6 million w/ 5.5% cap rate
Focus on geography
Knowledge of structuring deals in variety of asset classes
Eye on upcoming or forgotten markets
Outperformed by other asset classes in FL
Discount on replacement cost
Cash-flow during hold period
Path to grow NOI (Net Operating Income)
Focus on day-to-day
Build relationships, be transparent
Greg attributes his success as an institutional real estate investor to adopting his father’s hands-on business approach and his self determination and team-building background from competitive sports
Greg can be contacted with inquiries on deals, opportunities or advice on transitioning to a becoming an institutional real estate investor by visiting the Cardinal Point Management website
Real estate investors in Florida know that the market has seen a steadily increasing return to normalcy since it bottomed out in 2010. Asset classes of all types have been undergoing a resurgence as the market continues to correct itself. With investing outpacing development though, investors are seeing access to viable properties tightening up. Investors need to become more creative when finding deals and stay ahead of new trends arising.
David Beshears, head appraiser and owner of Beshears & Associates, has been appraising properties in Florida for over 20 years and he is very knowledgeable about the self storage market. John Miller, senior appraiser and realtor for Beshears & Associates, specializes in multifamily asset classes, having completed over 200 multifamily appraisals since 2008. This episode, David and John discuss where Florida markets are at, particularly in the multifamily and self storage market.
4% vacancy in Tampa area markets
Uptick in rental rates across sub-markets
High occupancy rates causing higher appreciation in Class B and C properties
Class A properties new builds at $2/sqf (Central Tampa Sub-market: Hyde Park, Westshore, Downtown Tampa, Davis Islands)
3300 units entitled to construction; 2200 scheduled for 2016 completion
Class A super properties arising in suburban markets (Riverview)
Luxury trend in new developments (zero-entry pools, state-of-the-art amenities)
No new builds for Class B and C properties
Cap Rates (Tampa): Class A: 4.5-5.25%; Class B: 5.25-5.75%; Class C: 6.5-9%
Value-add opportunities still available with focus on interior of units
Traditionally lag behind multifamily cap rates by 150-200 basis points
Self storage market similar to multifamily market
Subject to overbuilding in 3rd tier markets
12% of market owned by institutional investors
Value-add opportunity for private investors
Upgrade security and lighting
Cap rates: Class A: 5-7%; Class B: 7-9%; Class C: 9% and up
Major markets in need of new development
Opportunity for developers if they can find land
2-3 acres at $5-8/sqf is ideal
Beshears & Associates offers a newsletter providing an overview on a variety of asset classes in Florida, including the multifamily and self storage market. To check out their newsletter and to find out about the other services they offer, visit their website at www.beshears.net
Things are happening in the Miami real estate market… Well things are always happening in the Miami real estate market, but BIG things are happening right now. Miami has long been the focal point for real estate investors due to the density and scale of development and the investment opportunity for a variety of asset classes. Real estate investors all over Florida have looked towards the Miami real estate market as a forecast for current and future conditions throughout the state.
Tom Blazejack, of Blazejack & Company knows all of the ins and outs of the Miami real estate market. In addition to nearly 40 years’ experience as a real estate appraiser and analyst, Tom is also a native of Miami. Tom’s extensive appraisal knowledge of commercial and residential properties and intimate knowledge of the Miami real estate market make his consultation highly sought after by investors. This episode, Tom gives us an overview of the Miami real estate market, including development highlights and what investors should expect.
Miami Real Estate Market
2011 purchase of Miami Herald building for $236 million marks return of market
Foreign investment and cash-heavy market
Foreign investors seeking stable properties to invest cash
New deposit requirements for investors and developers insures accountability
Lenders alleviating construction loan costs for developers
Projects moving quicker
Land price increases
Miami seeing $200-300/sqf on new commercial developments but even as high as $3000 in some prime locations
Residential continues to increase… up to $3/sqf in best projects
Development spreading into surrounding Miami
Little Havana, Wynwood, Coral Gables all seeing new projects
Real estate development in Florida is currently in great demand. With real estate investors turning towards ground-up real estate development as an increasingly more viable means of investing, new projects are springing up state-wide. However, with increased pressure on real estate development and a construction workforce stretched thin, it is important to keep in mind key points if looking into real estate development as an investment goal.
Jonathan Moore, AIA is president and founder of InVision Advisors. His firm offers owner’s representation and project consulting services for owners and investors, architects and contractors during real estate development. As owner’s representatives, InVision Advisors takes a comprehensive approach to real estate development deals handling day-to-day and overall project oversight. As an experienced architect, Jonathan brings a unique insight to his knowledge of the real estate development industry. This episode, Jonathan discusses hot points for investors to know about real estate development.
7 Real Estate Development Hot Points
Markets state-wide are saturated with work
Sub-contractors control velocity of development
Artificial inflation caused by over estimation of construction costs
Problems frequently arise due to lack of communication
Loss of face-to-face time and on-site meetings contribute to communication breakdown
Real estate investors know that Florida’s real estate markets are tightening up. As the demand begins to outweigh supply, real estate investors are having to become much more diligent in their property searches. This is especially true for out of state real estate investors looking for Florida properties. Out of state real estate investors must not only know their desired market, but also how to acquire and execute deals from a remote location. How can out of state real estate investors keep track of the Florida markets?
This episode, we speak with Eric Black. Eric is an investor based out of California who has owned properties in several different states, including Florida (Brevard County). Eric’s position is a unique one in that real estate investing is currently ancillary to his full-time job in the technology industry. With the ultimate goal of a transition towards full-time real estate investing, Eric has adopted an interesting perspective on real estate investing that may be helpful for other out of state real estate investors. This episode, Eric discusses how he handles a full-time job along with being an out of state real estate investor and shares tips for others.
Tips for Out of State Real Estate Investors Looking for Properties
Adopt Marketing and Search Strategies
Build local network to market your investment goals and aid in property search (realtors, contractors, developers, investors, financiers, etc.)
Know Your Market
Best to visit your desired market area with a knowledgeable local contact
Statistics and data research
Google Maps/Google Earth
Have Effective Property Management
Property management benchmarks: vacancy turnarounds, communication with owner
Helpful Tools for Investors
Find a mentor or follow someone who has found success in your desired market
Real estate investors always keep an eye on Florida real estate markets. Not only does the state serve as a national indicator of market trends, but Florida also represents a major real estate market in itself. Despite ups and downs, Florida has remained an appealing market for investors. Investors must stay on top of changing market trends and know what the hot Florida markets are as well as the ones that aren’t.
Listeners may recognize Daren Blomquist from his previous appearance on the show. Daren is senior Vice President of RealtyTrac, a nationwide real estate data analysis firm, providing real estate professionals in-depth and up-to-date information and research on a variety of markets. This episode Daren discusses the changing face of Florida real estate as he covers some hot Florida markets emerging as well as ones that are winding down.
Florida market in strong recovery, but not at previous peak
52 consecutive months of year-over-year increases in home appreciation
12% in appreciation since April
Successful transition from cash-buyers to FHA financing
26% increase in FHA financing
11% decrease in cash purchases
Foreclosures still lead, but in decline
11 month decrease in foreclosures
10% increase in flips statewide
Deltona, Daytona Beach, Ormond – 49% y-o-y
Tampa – 11%
Jacksonville – hot flipping market and highest gross returns on flips
Home appreciations on the rise
Cape Coral and Punta Gorda lead state, though seeing decrease in flips
Affordability remains market concern
Home appreciations are outpacing wage growth
Affordability index of 100 or above is normal; below 100 is less affordable
Cape Coral – 100
Punta Gorda – 100
Naples – 102
Institutional buyers in decline, but still active
Investors and listeners can find out more about current, local affordability index data by visiting www.realtytrac.com/news
For those who want to learn more about the hot Florida markets and the premium service packages offered by RealtyTrac, visit their website and subscribe! Listeners to the Invest Florida Show are eligible for a discount on subscription. To find out more about this offer, contact email@example.com or call 888-408-4396.
Florida was hit hard following the real estate crash in the mid 2000s. As the market began to return, real estate investors saw the foreclosure market as a well-spring of opportunity and many took advantage of the asset class. However, as real estate markets have rebounded, foreclosure markets have begun to dry up. Investors have found it increasingly difficult to find successful strategies for bidding on foreclosures.
Our guest this show has been buying and selling foreclosure properties since the late 1990s. Focusing solely on Broward and Palm Beach counties, Eric Nathanson has developed successful strategies for bidding on foreclosures and has earned a leading reputation in South Florida’s foreclosure real estate markets. Eric is co-founder of Bidologist.com, a third-party turnkey investment company offering investors bidding on foreclosures a single source for investment solutions. This episode, Eric discusses the current trend in South Florida’s foreclosure markets as well as strategies for investors bidding on foreclosures.
Broward and Palm Beach Foreclosure Markets
Majority of real estate markets returning to pre-crash point
Large foreign investment/flight capital base
China, Brazil, Venezuela, Russia
FC supply thinning
Investors no longer able to cherry-pick from select areas
Must cast wider net to suit investment goals
Easier for investors to gather info on properties
Bidding pool expanded internationally
Bank has option to hide bid, making bidding more selective
Likelihood of future foreclosure markets slim
Financing regulations much stricter
Possible market for investors who can afford to purchase condos with rental restrictions and wait them out
Nobody said real estate investing was an easy business. Aside from the hard numbers and financial side, commercial and residential real estate investing requires dedication and perseverance from investors and a certain ability to thrive under pressure. For many, these pressures prove too great of obstacles to find success as real estate investors. Invest Florida Show aims to provide its listeners of all investment levels with the tools and resources necessary to make actionable investment decisions. In addition to providing educational resources to our listeners, we also want to inspire would-be investors to make the first big step and invest!
This episode our guest is all about inspiration. Mark Nathwani is a real estate investing specialist and international entrepreneur. Mark has assisted in the growth and development of many businesses and currently serves as CEO of RAMS Real Estate Holdings, a U.S./U.K. based firm focusing on foreclosure properties and other sensible Florida real estate markets. Above all else, Mark believes the first step is the biggest one: want to get into real estate investing? Just do it!
Mark’s Tips for Beginning Investors:
SFR properties are relatively stable, secure markets for those looking to begin real estate investing
Florida has many strong SFR markets:
Tampa, St. Petersburg, Jacksonville, Orlando
Tailor strategy to investment type:
Fix-and-flip, wholesales, holds
Invest based on yield as opposed to price and valuation
Yield is generally higher in complicated markets i.e. low-income housing
Choose a market and apply strategies that suit that market, don’t cherry-pick strategies from other real estate markets
Cast a wide net to find deals
Brokers, letters, bandit signs, banks, etc.
Never lose confidence in your deal!
To contact Mark with any potential investment opportunities or to find out more about his real estate investing services, visit his website!