Tag Archives: ROI for buying land

03.30.15
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SWFL Real Estate Market Fueled by “Boomerang Buyers”

SWFL real estate

Southwest Florida is number two in the country for “boomerang buyers”, people who blew up their credit with foreclosures in the housing crash but now are starting to regain their homebuying abilities, according to a study recently release by RealtyTrac.

Between now and 2022, boomerangs will be 21.4 percent of the number of housing units here: potentially 79,216 home buyers, the Irvine, Calif.-based real estate data company said.

That’s second only to 26.3 percent for Las Vegas, which during the home price implosion that started in 2006 was often neck and neck with this area in foreclosure statistics.

Generally, the boomerangs are making wiser home-buying choices than they did in the past, although debt to ratio seems to be the largest issue for the group when attempting to procure a home loan.
Not all the foreclosures in this area will necessarily translate into new local homebuyers in the future. The first three years were heavily non-homesteaded and predominantly from out of state. Additional measures such as owner financed land have helped spur this type of buyer in the SWFL market.

The buyers and investment real estate seekers would buy three houses at a time with the plan of getting rich flipping them.
Area marketing insiders predict the boomerangs coming back will add a welcome depth to the local home-buying market. Right now the housing recovery has been fueled by baby boomers with good credit and lots of equity, but it’s been mainly the blue chip buyer who’s brought the market back from the abyss.

Now the market will begin to be fueled by people who were in their 20s or maybe early 30s in 2005, 2006, who got an easy loan and lost the house. They’ve got a willingness to buy again, but they’re afraid because of what happened.

They’ll eventually be followed by so-called millennials, people who are in their 20s now but haven’t embraced homeownership in great numbers yet. That won’t happen for awhile but in three to five years it could be quite a phenomenon.

To learn everything you need to know about the SWFL and Cape Coral land scene, contact a member of the Gratia Group at (239) 333-2221.

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03.02.15
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Why you Should Consider Land a Viable Investment Option

Blog Photo-Land InvestingToday’s world is filled with consumers with a fair amount of disposable income that aren’t aware of their investment options. They are guided by friends and family who are often misinformed too.  The US alone has seen a rise of over 29 percent in the disposable income generated in the country between 2007 and 2012.  What are the people doing with this income?  In the search for investment options, you usually encounter a number of risks. The popular maxim of investing is that the risk you take is directly proportional to the returns on your investment.

Perhaps the starting point for most investors is the low risk option of fixed deposits, mutual funds or commodities.  The more adventurous may gamble on the high risk-high return stock options.  However, if you’re an investor with a medium risk appetite looking to get high returns, you might want to consider buying land investments.  Historically, land has only gone up in terms of value.  Over the last five years, land has shown over 100 percent value appreciation in some areas.  Such growth is indicative of the great potential land holds for investors, yet many haven’t recognized this opportunity so far.

In terms of residential land on the outskirts of cities, you should take into account that already established residential areas may be hard to penetrate owing to few available spaces and high capital that is involved.  Nonetheless, if you do your research you could find spaces that are either in the process of developing or aren’t discovered yet but have the potential to grow.  These spaces provide the best opportunities in land investment.

There are some key indicators you should base your research on before buying real estate for investors including connectivity and access to basic amenities.  Some of the major deterrents to buying land in the past have been misconceptions associated with it.  People often go by the erroneous notion that land does not produce income or produces very little of it.  According to research, land was the investment that provided over 100 percent returns on investment between 2010 and 2013.

The difference with land as compared to other investments is that it is a tangible asset that allows you to adopt a few precautionary methods that reduce the investment risk from medium to low while still maintaining high returns over a long term.  The world is short of habitable land that needs to be able to develop, accommodate, expand, scale up, build, grow or upgrade.

Nonetheless, that’s only a part of the reason investing in land should be an element of your portfolio.  All of the three primary needs for life- food, clothing and shelter – are dependent on land, which provides the investor with a host of flexible options on getting the best out of your land investment.  You could dedicate it to organic farming, tap into a small business idea or build a home on it.  At the same time, it also gives you an option to leave it alone because in most cases it still continues to appreciate steadily and surely.

Despite its promise people are often discouraged from investing in land by their perception of the amount of capital required for it.  Firstly, it is more economical to buy vacant land than a developed property, a number of investors have invested in land using their savings and entirely avoiding dealing with loans and mortgages.  Moreover, if you can find the right places to invest and get in at the right time, the returns could be great.  The additional feature is that land can be a source of passive income over the long term, meaning it requires the customer to do little actively to gain returns.  In essence, land as an investment provides a wider range of business opportunities in a sector that rarely depreciates.

Mutual funds, equities, commodities, residential property and other options all make sense in certain scenarios and so does land.  It is a long-term option that will diversify and add volume to any investment portfolio.  It’s important not to jump the gun on land investment, only venture into it if you’re willing to consider it as a serious option and treat it as a business endeavor.

To learn more about land investments contact a member of the Gratia Group team at (239) 333-2221.
 

12.22.14
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SWFL Land and Home Sales See Big Jump

Blog PhotoThe median price of an existing single-family home in Lee and Collier counties increased sharply in October compared to a year earlier along with Cape Coral land prices.  In Lee County, the median rose 17.3 percent from $157,000 to $184,175, according to statistics released by the Realtors Association of Greater Fort Myers and the Beach.

Collier County’s median increased 20.1 percent from $279,000 to $335,000, according to the Naples Area Board of Realtors.

Area real estate experts feel that even with such a robust surge in Florida land sales prices, there isn’t the danger of a bubble similar to the last boom’s over-heated market in 2005.  It would take annualized increases of 20 percent for five years to get us up into the territory where the region was (at the peak of the boom and currently the area isn’t even close to a danger bubble.

The rate of increase in prices is actually slowing but the market will stay strong this winter with omens such as six feet of snow in Buffalo, N.Y.   Experts feel the region is poised to have a very, very good season.  To learn more about the SWFL real estate market contact a member of the Gratia Group team at (239) 333-2221.

05.26.14
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2 Beautiful Lots in NW Cape Coral; The Gratia Group Featured Lots of the Week

NW6th NW37

It’s a big week for investors as we feature 2 lots in the highly desirable Northwest Cape Coral as the Gratia Group Featured Lots of the Week.  These two lots are located at:

3416 NW 6TH ST CAPE CORAL FL 33993
2206 NW 37TH PL CAPE CORAL FL 33993

 

These lots aren’t only located in one of the most up and coming areas in the “Cape”, but also feature gulf access, a rarity in this area.  Lots are selling quickly in the NW Cape and listed at $89000 & $69,000 respectively, these lots are sure to close fast!  Investors have found great success in purchasing property in Cape Coral, particularly the northern section of the largest city in Southwest Florida.  A hot spot for boaters, golfers, fishing enthusiasts and those that love the natural beauty of South Florida, Cape Coral is home to a large population of foreign investors.  Don’t miss out on owning a piece of paradise!  Contact Gratia Group today to find out about these ROI producing Cape Coral lots or others in our land catalog by calling a member of the expert land team at (239) 333-2221.

05.12.14
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FIRE SALE: Gratia Group Featured Package of the Week


255 rotonda blvdmarker rd

Looking for a no hassle, no haggle land investment package in Florida?  If so, the Gratia Group Featured Package of the Week is for you!  Take part in this FIRE SALE and SAVE!  These two Florida lots must sell now!  With an ideal location in beautiful Rotonda West, Florida, these lots are perfect for land investment or building your Florida dream home!  The exact location of the Featured Package of the Week is:

97 MARKER RD ROTONDA WEST FL 33947
255 ROTONDA BLVD S ROTONDA WEST FL 33947

 

Rotonda West is a peaceful, planned community situated near the beautiful Gulf of Mexico in Southwest Florida.  It is located between Sarasota and Fort Myers.  The community contains 8,000 home sites with over 5,000 homes completed and is experiencing rapid growth.  Residents are predominantly full-time homeowners and their families, as well as tenants and those who winter in the community.

There are six golf courses operated by Rotonda Golf and Country Club.  Thirty miles of picturesque canals, lakes and ponds wind through the community and offer fishing and boating opportunities for its residents.  Many exotic and beautiful birds call Rotonda West home, as it is a designated Bird Sanctuary.  Nearby recreation facilities, beaches, theaters, sporting events, and fine restaurants are available for all.

The Featured Package of the Week presented by Gratia Group is priced to sell at an incredible $31,400, a great price for Rotonda West home sites.  Additionally, these lots must sell together, as a lot package and cannot be purchased as individual lots.  To take advantage of this great deal, contact a member of the Gratia GroupSales Team at (239) 333-2221.

04.07.14
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Purchasing Land for Long-Term Investment

Vacant land can be a great alternative investment to other risky investment scenarios such as stocks and bonds.  For investors that purchase land as a long-term investment, buying land in a growing area is as vital as the investment land itself.

Studying the direction of growth of a city or town highlights areas that have become populated over a specific timeframe and where this activity has been focused.  This information is beneficial to landowners and potential land investors for a multitude of reasons.

Successful long-term land investors are picky when it comes to where they purchase real estate for investors.  They study area growth and development closely.  The more developed an area becomes, the more profitable and desirable their property will be.  Highly developed areas attract more interest, whether it is for developing businesses or residential neighborhoods.

Eventually, businesses and neighborhoods will expand throughout the majority of the town center and land for sale will be scarce.  Due to its popular location and scarcity, land that remains vacant throughout the growth of an area will become more valuable than it was in previous years.  This increases potential profit if and when a long-term investor sells creating a potential for high return on their original investment on the land.

To learn more about long term land investing, contact a member of the Gratia Group Land Investment Team at (239) 333-2221.

 

 

 

 

 

03.24.14
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Lee County Home and Land Prices Jump 19%

Tight inventory in February continued to contribute to the ongoing rise in Lee County median home and home site prices according to February 2014 sales statics recently released by the Realtor Association of Greater Fort Myers and the Beach.  The number of new listings (245) in February was 11.8 percent below January, but still showed a strong month in year over year comparisons.  The median price for single-family homes in February was $185,000, a 19.4 percent increase compared with the $155,000 median price in February 2013 and an increase of 27.3 percent (or $5,050) from January.  The median price of condos increased 10.7 percent to $155,000 in February compared with February 2013.

As prices continue to rise and inventory remains tight, desirable homes are selling quickly.  It is anticipated that this will be the case through April, as seasonal visitors are making the decision to purchase, which is challenging to Cape Coral and other Lee County residents, especially first time buyers, facing higher prices, rising mortgage rates and tighter credit.

Single-family homes of all types spent a median 52 days on the market before coming under contract in February and the average home sold for 93 percent of its listing price.  In February 2013, those numbers were 57 days and 93 percent, respectively.

Thinking of purchasing property in Cape Coral, Fort Myers or elsewhere in Lee County?  Gratia Group can help!  Give us a call at (239) 333-2221 to get your property search started today!

02.24.14
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Florida Population Growth Returns to Normal Levels

After growth screeched to a halt during the recession, people are moving back to Florida.  Researchers project 192,091 new faces will arrive in Lee, Collier and Charlotte counties over the next seven years.  The coastal stretch is already home to an estimated 1.1 million people.

Lee County leads the way, growing 20.2 percent, twice the rate of Florida as a whole, to reach 773,500 people by 2020.  Collier will absorb 49,537 new residents and Charlotte 12,421.

The projections from the University of Florida are based on past growth. They’re a conservative estimate between the lowest and highest estimates. Population increases fuel economic development but also pose infrastructure and environmental challenges.

Waterfront property and activities are top selling points driving people to Florida.  Water, for drinking, swimming, fishing, but first of all for our natural habitat, is key to a healthy economy.

People move to Florida for a wide variety of reasons. It’s known as a place where they come to retire or start over, for instance. And as more arrive, housing inventory is being reduced and construction is picking up. That in turn attracts new residents. There is also no personal income tax in the state.

Florida lost a small percent of its population because of the recession. Now the state is on track to surpass New York this year if it hasn’t yet already. That would make it the third most populous state behind California and Texas.

Through 2020, Florida is projected to absorb some 1.9 million new people, pushing the population past 21.1 million.

For now growth is trending steadily upwards in Southwest Florida, albeit not at the breakneck pace seen in the early to mid-2000s. Cape Coral, the region’s most populous city, grew by 6,764 people between 2010 and 2013, UF estimates show. Nearly 160,000 reside in the Cape.

Many homebuyers are baby boomer retirees from the Midwest and Northeast, but a surprising number are younger.

But with all the growth, is Southwest Florida gearing up for another precarious real estate bubble? Lee County especially Lehigh Acres was often cited as a “ground zero” for the housing meltdown that preceded the recession. Many economic forecasters feel the region is going to see sustained growth in more of a normal market. As once vacant homes and properties left untended during the recession fill up it makes it a lot safer for the buyer.

 

Long-term population projections:

 

Charlotte County

2013: 163,679

2020: 176,100

Change: 12,421

Percent change: 7.6

 

Collier County

2013: 333,663

2020: 383,200

Change: 49,537

Percent change: 14.8

 

Lee County

2013: 643, 367

2020: 773,500

Change: 130,133

Percent change: 20.2

 

Palm Beach County

2013: 1,345,652

2020: 1,465,300

Change: 119,648

Percent change: 8.9

 

Florida

2013: 19,259,543

2020: 21,141,300

Change: 1,881,757

Percent change: 9.8

 

To learn more about the real estate market in SWFL contact a member of the Gratia Group team at (239) 333-2221.

02.10.14
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Short Term vs. Long Term Land Investments

Investors looking to build a robust, dynamic portfolio of low-risk, high yield investments should consider buying land investments.  When deciding to purchase land an investor should ask themselves a few questions.  First, are you looking for a quick profit or do you want to make improvements on and use this property over several years?  Perhaps this is simply a moneymaking investment or maybe an investment for you and your family’s future?  Let’s look into the differences between investing in land for the short term versus the long term.

Purchasing investment land in the short term is less common and a little trickier than a long term investment, although it is possible. The pros to a quick flip are:

1) Cash in hand, and who doesn’t like that?

2) Using the money to make more investments (preferably in more land!).

3) Paying very little in property taxes, depending on how long the property is in your name.

Long term land investments are much more commonplace.  Some pros of holding onto your land investment include:

1) Securing the future of your family.  Land is a stable investment and can be passed down to future generations of family.

2) Using the land as a cash generator.  Some examples of ways to make money with your land are a vacation rental or agriculture (crops and/or livestock).

3) If you wait longer to sell the land, it’s likely the value will have increased even more than if you sold in the short term.  You will see the most increase in value if a big company offering many jobs has moved into the area or if the population has increased significantly over time.

4) Being able to make improvements on the land that will increase the value significantly.  The improvements can be simple, such as having the land surveyed, or more involved such as digging a well or building a house.

To purchase land for investment purposes contact a member of the Gratia Group Land Sales Team at (239) 333-2221.  Our large selection of Florida land for sale is waiting to be added to your investment portfolio!

01.27.14
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2013 Lee County, FL Real Estate Wrap Up

Lee County permits to build new homes in 2013 spiked up 40 percent while foreclosures fell 45 percent in 2013 as the area’s given-up-for-dead residential construction industry roared back to life.  But with the burst of activity came some old worries: a tight labor market, ever more expensive building materials and the prospects of higher interest rates.  For the year, builders pulled permits to put up 2,386 single-family homes compared to 1,707 in 2012.

Meanwhile, statistics released by the Southwest Florida Real Estate Investment Association showed that foreclosures fell from 7,600 to 4,212 in the same period as the firestorm of failed mortgages by homeowners and investors gradually burned itself out. All in all, builders were happy with the sudden availability of work.

The market in Southwest Florida is picking up pretty good and of course there are more new builders that have taken the opportunity to break into the building market buying up most of the available Southwest Florida land for sale.  Still, as the market heats up issues are arising. There’s not a large enough labor force in the area and there have been price increases for materials as well as wages.

Several factors combined to create a more energetic market.  Chief among them was the cheap money for mortgages and the fear that they would be going up, so you have a lot of buyers, particularly young and first move-up buyers, concerned that if interest rates went up much they’d be out of affordability.  Many of those buyers had the down payment and had gone through the two-year period they had before they were allowed to apply for a mortgage again after a foreclosure or short sale destroyed their credit.

That trend was amped up by the fact that there’s pent-up demand for new housing because few new homes were built in the years since home prices collapsed at the end of 2005.  It’s not a situation that can last forever.  Clear interest rates will eventually have to increase as the Federal Reserve scales back its efforts to keep money “cheap”.  For every point the interest rate goes up, say for an average house in Lee County, a $250,000 house, that’s $20,000 less borrowing power the buyer has.  For bigger houses the effect is dramatic.

One problem that isn’t coming back soon is the prevalence of foreclosures that drove down prices as foreclosed homes came pouring back on the market after prices fell apart.  Most of the people vulnerable to a foreclosure have already lost their homes.

But ongoing economic uncertainty may have an effect on how strongly the baby boomers’ retirement plans continue to support this market as boomers decide how long to work before retiring and buying a home or lots and acreage for sale in the area.

To buy into the robust Lee County, FL real estate market contact a member of the Gratia Group Land Sales Team at (239) 333-2221.