COMMENTARY | Several relatives of mine have purchased Florida homes in the past six months. According to an article by MainSt.com, now could be the last chance to find a good deal on real estate properties as the baby boomers become snowbirds. One relative purchased a short sale, while another relative got incredible deals on three foreclosures in Southwest, Florida. They plan to keep at least one home for a winter home, while renting out the others.
Florida houses are cheap
Having lived in Florida for more than 10 years, I know the housing market is particularly battered right now. A person can pick up a decent house for as low as $60,000.
My husband and I have considered purchasing a retirement home now even though we are 25 to 30 years away from retiring. Turns out we are not the only people contemplating that.
The National Association of Realtors says vacation homes made up 10 percent of the purchases in 2010. They say the typical vacation home buyer was 49 years old with an income of about $100,000. Thirty four percent of the vacation home buyers say they may turn the home into their primary residence in the future.
Competition for good housing deals is fierce
Experts say the homes in warm-weather regions are starting to see a housing recovery. My relatives have had to be quick to pounce on opportunities for distressed properties they plan to turn into rentals. It's a more competitive climate than it was a few years ago.
It's been interesting for me to observe the challenges that my relatives are having. My husband and I are learning from their experiences with real estate investments in Florida.
Headaches of having more than one house
One thing we have learned is that it's best to reserve one home that you will occupy yourself. Renters often damage properties.
Two of my relatives plan to be snowbirds, but won't be renting their Florida winter homes out when they go back north. They don't want to worry about the condition of their furniture, appliances or flooring. Still, they need to make sure the lawn is mowed while they are away.
As for the investment properties, they have chosen to hire property managers to handle the headaches such as receiving the rent checks, maintaining the property and handling complaints.
I've noticed several subdivisions built in the past few years that are specifically targeting the baby boomers as they begin to retire to Florida. Some are 55-and older or age-restricted communities are some are not.
From what I've seen, baby boomers will drive vacation-home sales in Florida for the next decade. My husband and I know that if we want to get a deal, we can either buy a vacation home now or wait another 15 years when the cycle completely reverses.
As baby boomers move into assisted living facilities, there will be a flood of houses on the market in Florida. It will be called the baby boomer vacation housing bust. It's something for Generation X and younger people to keep in mind.
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