Florida Real Estate Is Booming
Here’s news the mainstream media will ignore or shoo to the back pages but facts are facts: The residential land market in Florida is “very strong as a result of the improving economy, combined with the continued influx of almost 1,000 people per day to the state.”
Not my words, they come from “Lay of the Land,” a new market report via Florida Trend. The report provides an accounting of verified land sales from 2017.
“As demand for residential development land increases, sales of agriculture land in the paths of progress increase,” says Dean Saunders, owner of Lakeland-based Coldwell Banker Commercial Saunders Real Estate and publisher of the report. “With the capital earned from selling land for high development prices, sellers are reinvesting in other rural agriculture land.”
Saunders, once a legislative aide to U.S. Sen. Lawton Chiles and later a Florida legislator, conducted his “Lay of the Land” conference in April at Champions Gate near Orlando. It was the ninth such annual event his firm has sponsored.
Where is all the residential growth occurring? Much of it is along the I-4 corridor from Tampa to Daytona Beach.
Chief Economist for the Florida Chamber of Commerce Jerry Parrish told conference attendees that from Jan. 1 to April 6, 83,524 people had moved into Florida, and the state’s adjusted gross income grew by $2 billion. He said people from New York, New Jersey, Pennsylvania, Ohio, and Connecticut — in that order — lead the migration into the state.
Of 19 counties specifically studied for the report, the real estate market in counties along the Treasure Coast and surrounding it — Indian River, St. Lucie, Brevard, Martin, and Okeechobee — was the hottest.
In Indian River County, 5-acre ranchette lots sold at the bottom of the market in the $10,000 to $12,000 range. Compare that to prices two counties to the south in Martin, with a few sales in the $25,000 to $50,000 range for home sites of approximately 5 acres.
Other highlights in the report:
— Average cost of a usable acre in Central Florida is $56,672. But the range is big and depends on a lot of factors (jobs, shopping, recreation, for instance) … Martin County, over $200,000 per acre; St. Lucie County, a little below $20,000 per acre.
— In all of Florida, the most significant sale in 2017 was a sale in Martin County, Pero Farms to Gladstone: 3,518 gross acres for $55 million.
— The citrus industry “continues its tailspin” because of citrus greening and Hurricane Irma.
— Citrus groves no longer productive are selling in the $3,500 to $5,300 per acre range, while better-producing groves are fetching $5,000 to $8,000 per acre.
— Okeechobee County farm sales ranged from $4,849 per upland acre, where conversion from citrus was required, to $7,080 per upland acre for a turnkey farming operation.
— Gone are the recession days when there was a large inventory of single-family building lots — that’s pretty much gone now.
— As for the Everglades Agricultural Area (EAA), lands in the central region of the EAA, within Palm Beach County, “are the most desirable, with prices exceeding $11,000 per acre.”
Florida land brokers “are all slammed; we are all busy,” Saunders said. He attributed the recent high land sales activity in part to high consumer confidence and tax reform. The development of solar farms, Florida’s huge population growth and a strong housing market also bolster land sales.
He singled out 1031 exchanges for their contribution to land-sales activity. Those are the exchanges that allow landowners to sell one piece of real estate and defer taxes on the sale by buying another. The 1031 exchanges are a great deal, Saunders said, adding, “Don’t pay Uncle Sam; go buy something else.”
Bullish-on-Florida Saunders’ parting three words to conference goers repeated the theme: “Buy some land.”
AUTHOR: Reach Nancy Smith at firstname.lastname@example.org or at 228-282-2423. Twitter: @NancyLBSmith