Think you know the next hot real estate market?

Then you know a good real estate investment depends on more than just the property. It could have all the right physical features, but if it’s in an under-performing market, then the property will never produce a strong ROI. There are socioeconomic factors that affect an investment’s value. These factors can include: population growth, market supply, and municipal planning.

You can track these factors before making an investment decision using forecast models. You can track pertinent market data as it relates to an investment value. Real estate investors and developers use forecast models to determine what markets to focus on. They can also be used to track up-and-coming markets, so you can get a lead on the next hot real estate market!

There’s few more qualified to talk about forecast modeling than David Farmer. A recognized civil engineer, and city planner, Dave has been in the real estate industry for more than 20 years. He has extensive development experience and is the former Chairman of SW Florida District Council for the Urban Land Institute.

He now lends his extensive real estate expertise to Metro Forecast Modeling (MFM), a population forecasting and modeling firm in Lee County. As CEO of MFM, Dave brings his understanding of growth drivers to forecast analysis.

Find out how you can use forecast models to get a lead on the next hot real estate market!

Population growth dictates housing demand which determines what development is needed
2 types of forecast models:
- Aggregated - wide-scale analysis of an entire metro area
- Dis-aggregated - Analyses based on designated zones within a metro area. Lee County is divided into 1400 traffic analysis zones.

Florida Market Forecasts

Lehigh Acres:
- 1-2% vacancy rates, high housing demand
- Need for commercial development
- Poor planning makes aggregate development projects difficult
Downtown Sarasota:
- Can accommodate higher density than currently using
- Multifamily and commercial developments replacing existing small structures
Jacksonville:
- Pent-up housing demand
- 3000 additional units needed now
- 1600 more needed by 2020
Orlando (City):
- High housing demand
- 8000 units needed over next 3 years

Contacts

You can contact Dave directly at dave@metroforecasting.com
You can find out more about MFM’s services by emailing info@metroforecasting.com

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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
  1. Deltona, Daytona Beach, Ormond – 49% y-o-y
  2. 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
1. Jacksonville
2. Pensacola
3. Tampa
4. Ocala
5. Lakeland

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 marketing@realtytrac.com or call 888-408-4396.