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Florida Apartments Sell For Less Than Build Cost
January 14, 2009Article by Ray Withers
Every cloud has a silver lining, and the credit crunch could come up trumps for Florida property investment. Florida property prices have been ravaged by the fall-out of the crisis in the US banking system and the aftershocks that have rocked the economy. For investors, now is the time to swoop and pick up bargain. Prices are low, sellers are desperate and Florida real estate dropped an average 20% year-on-year to the end of 2008.
Developers have started to adjust their sales-price expectations and cheaper apartments and homes are catching the eye of international buyers. Investors are now seeing far higher yields than before. With construction starts at historical lows and population growth in Florida among the highest in the country, the residential market will be in short supply in the coming years. Coupled with a tourism industry that is continuing to post growth year on year, demand for quality accommodation should remain high for years to come.
The Kissimmee property market follows the trend and one development catching the eye is apartments at Cane Island, Florida, rubbing shoulders with Disneyland and Florida’s huge range of entertainment attractions are all within an hour or so’s drive. Flights are easy from the UK and car hire is cheap at the other end. Cane Island is an hour’s drive from the airport.The development is now offered at 54% below the 2005 launch price – which the developers claim is lower than the build cost. Mortgages are available at 70% loan-to-value with a minimum cash deposit of £24,300 plus purchase costs. Luxurious two bedroom apartments start at £94,127. Apartments with three bedrooms cost from £103,237. Top of the range four bed roomed apartments are from £121,457 Yields of up to 6% are expected.
Since the subprime crisis hit the US, prices across the board have fallen markedly, even in areas where rental demand has stayed strong. Disney has seen increasing visitor numbers because of new attractions and emerging markets, like South America. Florida’s popularity as a year round family holiday destination remains intact and Disney’s visitor figures seems to show that people will not forfeit their holiday even in difficult economic times. Cane Island consists of 260 completed luxury condo apartments. Designed to meet the growing demand for international tour operators. Property Frontiers said written confirmation from Amazing Vacation Homes Inc stating they will manage the property and expect a 42-week rental season. Their clients include internationally renowned hotel companies such as Hotlebeds.com – part of TUI Travel plc.