Topic: Buying a house in Florida - Advice?

[Minou]

I plan to retire in 5 years and am thinking about buying a house on the Florida west coast for when I become a snowbird...

I have inlaws "winterizing" in the area.  The sister in law and husband just bought a nice and very clean bungalow with single car garage in a very nice neighbourhood for just $74000. USD that they're renting to an acquaintance for now.

I was there last week and visited a handful but didn't make any offers as I'm not in a hurry but would like to benefit from the low prices.  On the other hand, my $$ is in CAD$ and the exchange rate (1.30 range) is now defavorable again.

What would you do?  Are prices going to go down further? Will the USD sink and favor the CAD?

Then, there are the taxes, high insurances and cost of maintaining a house while you're not present.  And the ever probablility of a Cat 3 hurricane or higher.

What about fiscality?  If you sell at at a profit down the road?

[tpl]

And don't forget the possibility of the IRS getting involved if you die while owning AND have a total estate of above a certain amount ( I forget... $300,000US including properties,shares and stuff and cash/life insurance).  Its only a possibility and I believe that there are ways to make sure it doesn't happen.

[Leviathan]

Don't forget to account for rising sea levels 

[Sir Osis of Liver]

Depends on what you want really.

If you just want a small spot to ride out the winter for a few months, you could do as my Father. He bought a small trailer in a seniors trailer park in New Port Richie (North of Tarpon Springs on I-19). Minimal insurance on it, and if a hurricane blows it all away, he isn't out much.

A house is another matter. Property taxes and insurance are quite high (local co-worker was spending $6500 a year on insurance for a 2500sq ft bungalow), so do your due diligence before buying. Most residential construction done from the mid 1990's onward is very low quality: cheap materials slapped together in a hurry by migrant workers. HOA's in some areas can be quite onerous too.

From what the folks tell me, prices are still dropping for the most part and likely to continue well into next year. Pretty much the whole state is in tough shape right now.

I stayed in Apollo Beach in 2007. My townhouse was sold to the landlord in 2005 for $650k. When I left in late June, an identical unit had just been marked down to $399k. From what I heard, it still hasn't sold.

[Minou]

Depends on what you want really.

If you just want a small spot to ride out the winter for a few months, you could do as my Father. He bought a small trailer in a seniors trailer park in New Port Richie (North of Tarpon Springs on I-19). Minimal insurance on it, and if a hurricane blows it all away, he isn't out much.

A house is another matter. Property taxes and insurance are quite high (local co-worker was spending $6500 a year on insurance for a 2500sq ft bungalow), so do your due diligence before buying. Most residential construction done from the mid 1990's onward is very low quality: cheap materials slapped together in a hurry by migrant workers. HOA's in some areas can be quite onerous too.

From what the folks tell me, prices are still dropping for the most part and likely to continue well into next year. Pretty much the whole state is in tough shape right now.

I stayed in Apollo Beach in 2007. My townhouse was sold to the landlord in 2005 for $650k. When I left in late June, an identical unit had just been marked down to $399k. From what I heard, it still hasn't sold.

The area you mention is exactly where we go to.  My GF's parents have a house in Holiday for 32 years now and her sister's is further north in Hudson.  We rode the bike path all the way from Tarpon Springs to Clearwater last year and last week again actually.  I really like the area between Tarpon Springs, Palm Harbour and Dunedin but it looks to be mostly condos and townhouses overthere with more single family homes further north from Holiday to Spring Hill.

From what I saw, property taxes on a 1500 sq ft bungalow or less is in the 2K range excluding insurances, sinkhole insurance, pest control, HOA's, etc.

Last year on the bike path, we met a retired couple from Quebec who bring their trailer to a trailer park near Clearwater and there are a couple along the bike path as well.  Apparently that you can buy one used for not too much and make arrangments to leave it there during the summer months.
Something I should investigate further indeed.

[Sir Osis of Liver]

Depends on what you want really.

If you just want a small spot to ride out the winter for a few months, you could do as my Father. He bought a small trailer in a seniors trailer park in New Port Richie (North of Tarpon Springs on I-19). Minimal insurance on it, and if a hurricane blows it all away, he isn't out much.

A house is another matter. Property taxes and insurance are quite high (local co-worker was spending $6500 a year on insurance for a 2500sq ft bungalow), so do your due diligence before buying. Most residential construction done from the mid 1990's onward is very low quality: cheap materials slapped together in a hurry by migrant workers. HOA's in some areas can be quite onerous too.

From what the folks tell me, prices are still dropping for the most part and likely to continue well into next year. Pretty much the whole state is in tough shape right now.

I stayed in Apollo Beach in 2007. My townhouse was sold to the landlord in 2005 for $650k. When I left in late June, an identical unit had just been marked down to $399k. From what I heard, it still hasn't sold.

The area you mention is exactly where we go to.  My GF's parents have a house in Holiday for 32 years now and her sister's is further north in Hudson.  We rode the bike path all the way from Tarpon Springs to Clearwater last year and last week again actually.  I really like the area between Tarpon Springs, Palm Harbour and Dunedin but it looks to be mostly condos and townhouses overthere with more single family homes further north from Holiday to Spring Hill.

From what I saw, property taxes on a 1500 sq ft bungalow or less is in the 2K range excluding insurances, sinkhole insurance, pest control, HOA's, etc.

Last year on the bike path, we met a retired couple from Quebec who bring their trailer to a trailer park near Clearwater and there are a couple along the bike path as well.  Apparently that you can buy one used for not too much and make arrangments to leave it there during the summer months.
Something I should investigate further indeed.

Mum and Dad love that bike path. They get on it almost daily.
Their trailer is a park model with an attached sunroom. I forget how much they pay for lot rent, but it wasn't much. A few of their neighbours stay year round and keep an eye on it for them. He used to haul a 5th wheel trailer back and forth, but this is much less of a hassle.

IIRC trailers of a similar size were selling for $10k or less.

Insurance varies wildly, so make sure to get a few quotes before signing on the dotted line.

A lots of "$xxxx or best offer", "motivated seller" type of signs up the last time I was there. Lots of abandoned homes and foreclosures there too.

[Ex-airbalancer]

My parents had a place in Holiday in the '90's
The 2 x we visited there, it was freezing, ice on the roads
Have not been back since

[Railton]

Minou, Let me know if you want to purchase a 2 bdrm, 2 bath condo in Ormond Beach.
Railton

[Wetson]

First off.  Do your research.  Lots of research.  Properties in Florida require different maintenance then properties in Canada.  (power washing for moss/mould, insect control) because of the humidity.  That being said.... get yourself a Realtor there that you trust.  Particularly south of the border.  Their real estate laws are different then here. A larger portion than normal of Realtors in the States, at the moment, are 'hungry' so be careful and ask lots of questions. 

A Realtor familiar with living in Florida will be able to answer your questions about maintenance, financing, foreign ownership etc.  It wouldn't hurt to talk to an Accountant here and south of the border and a lawyer to answer your questions about being a foreign owner of property in Florida.

When it comes time to purchase and put an offer in, insist on a condition in the sales offer of home inspection.  It was mentioned that many properties were constructed shoddily in the 90's up.  Although a home inspector won't open walls they will have a better trained eye to look for signs of structural deficiency, water damage etc.  Note that most of Florida is swamp land and at sea level.  As a result, a good portion of the homes are built on concrete pads with no basement.  Keep an eye on the floors for signs of shifting and water seepage from ground water coming in.  (I'm not an expert but common sense dictates).  Also MOULD.  Make sure the house inspector looks for signs of mould. (A little isn't going to kill you (make sure it's taken care of should decide to purchase) but if it's running rampant in the home run away).  Flip side is that it's a sub tropical to tropical area so the high humidity makes mould a more common thing and hard to avoid. Use your common sense and ask lots of questions and get a second opinion if you are not satisfied with the first one.

From a financial perspective also insist on a condition of clear title or something along those lines (This is where talking to a reputable real estate lawyer before hand comes in).  There have been a lot of foreclosures in the U.S.  You want to make sure you are protected should future problems with title or financial liens arise or ideally that no problems with such will occur.

All in all there are some very good real estate deals to be had in the US at the moment but remember that an ounce of prevention is a pound of cure.  Talk to professionals who know the details.

Hope this helps.  I'm not an expert on Florida real estate or foreign property ownership but hope I've helped to guide you in the right direction to make an informed purchase.

Cheers

Tim

[Brig]

Oh, and check the drywall, too.

http://edition.cnn.com/2009/US/03/18/chinese.drywall/index.html?iref=mpstoryview

[safristi]

  brings new meaning to TAKE OUT...............................that shyte....

[Ex-airbalancer]

I believe you have to get the house fumigated  when you buy a place

[ArticSteve]

Oh, and check the drywall, too.

http://edition.cnn.com/2009/US/03/18/chinese.drywall/index.html?iref=mpstoryview

Christ Almighty    ... you'd think that heavy drywall would be immune from the Chinese invasion. 

[Minou]

Txs all for your input, appreciated.  I'm keeping a copy of the chinese drywall case as one of the homes I visited was of that vintage (05-06) and being let go to foreclosure.

Real estate agents in Florida may be hungry for business but the inlaws had to deliberately walk into a Remax office asking if there was an agent willing to sell them a house because nobody seemed willing to help.  Having a home inspection by a local specialist is definitely on my list of things to do even though I have a diploma in Civil Engineering and been working in meteorology since 1984.  On that subject, I find it curious that Wikipedia cites an elevation of 213 ft for the city of Spring Hill while Hudson just a few miles south sits at only 10 feet, which is more like the rest of the Florida peninsula being at sea level or very close.  I'll have to see for myself if the Hill in Spring Hill is in the name only or for real.

Of course, I'm not counting on real estate agents, no matter how good,  to tell me everything I should know.  A lot of research I have to do myself.




These pictures were taken last thursday:  The second one from the Memorial Bridge linking the coast to Clearwater Beach.  And the first is on the bike path somewhere between Clearwater and Dunedin.

[ArticSteve]

My parents had a place in Holiday in the '90's
The 2 x we visited there, it was freezing, ice on the roads
Have not been back since

Central Florida has gotten much warmer these days.  In the 70's you needed to be down in Miami to get warm weather Jan-Feb consistently.

[safristi]

..they voted Democrat.....................HELL hath no fury.............. ........read Gordon Pape's take on it he's wealthy and warns of all the pitfalls as an owner in the FORT MYERS area...ain't fer the faint of heart OR light of wallet...............rent fer the time ya want to go IMHO...and U get to experience different spots...panhandle,Sebring,Keys when yer feeling gay,Miami when yer feeling vice like, yada yada yada...........who wants to be stuck in one spot with MOLDY OLDE FOLKE eh!!!

[johngenx]

Florida is nuts.

http://www.tcpalm.com/news/2009/mar/19/stuart-trio-allegedly-robs-pizza-place-gas-station/

http://www.wtsp.com/news/local/story.aspx?storyid=102531&catid=8

http://www.clickorlando.com/news/18965374/detail.html

http://www.miamiherald.com/news/broward/breaking-news/story/956282.html

http://www.tcpalm.com/news/2009/mar/18/teen-catches-monster-sized-bull-shark/

http://blogs.tampabay.com/breakingnews/2009/03/person-falls-from-hotel-balcony.html

The whole state is non-stop weirdness.

[Minou]

Digging out my old topic.

I have an accepted offer for 80K USD on a very clean 1500 sp ft ranch style bungalow.  2 car garage, 2 bed and 2 bath house built in 1977.  Lot is 7670 sq ft.  Great quiet neighborhood with bike paths, community services off highway 19 in Hudson Florida. 

An inspection will be conducted next week just in case but the property is in great shape.  If all is OK, it will be ours in one month.

Compared to our shopping last year, home prices are down maybe another 10 % but the exchange is currently much more favorable down from around 1.28 to 1.09.  So a good 25-30K Cdn less cash outlay.

Can't wait to retire and spend winters overthere!




 

[99 Silver]

Congratulations on your purchase.  I don't think prices have completely bottomed yet, but they are getting pretty close.  I'm sure it will be a wise investment for you and your family.

My wife and I have spent some time in Florida in the winters for the for the last twenty years or so and I always told her that I would not buy real estate there.

Well that all changed a couple of weeks ago when we bought a foreclosure condo townhouse with Chinese drywall in a gated community in Naples. These units sold for over 600k at the peak of the market and we paid less than 100k.  It is a 2100 square foot, 3 bedrooms, 2.5 bath 2 car garage bungalow with a private pool / recreation facility with no golf.  I didn't want the golf course because of the fees as I only play 3-4 times per year.  It is built with concrete blocks and concrete. The drywall doesn't scare me as I am a mostly retired contractor / developer and have already contracted a firm to gut the place to the studs and completely re-finish it which will take about four weeks.  We were able to get it at such a low price because of the drywall problem and the fact that most American buyers want to mortgage the property but the banks won't touch it until it is renovated.  This eliminated the bulk of the buyers on this property.  The only downside is that it will cost about 9k per year for taxes, common fees, insurance and utilities.  We'll use it for a couple of months, but my kids and their families will make good use of it also.

I don't expect values to rise in the near term, but expect a substantial increase the next ten years or so.  The home is only about 20 minutes from the airport.  We're lucky in that we are only 2.5 hours to the Detroit airport which has 3-4 flights per day to Naples at very good prices.  We are going down shortly for the closing and furnish the place and got tickets for $205 pp USD return including taxes.

[Minou]

Wow, screaming deal!  Yeah, the issue of chinese drywall was put to my attention in this thread last year. 

Curious at how big the anomaly is in the real estate market between parts of the USA and Canada.  Either we're too high and they're too low.  I'm only 50 so with good care, I'd be very surprised if our house wouldn't increase in value substantially in the next 20-25 years. 

Good luck with your property.  Long term, you can't lose.