Who Is Buying A Home Here?
By Patricia Tan
We are all reading market reports about low inventory, rising prices and sometimes multiple offers on a particular property, but who are the buyers, and where are they coming from? What is driving them here?
Why do people buy in Florida, and more specifically on the beautiful west coast of Florida? Retirement, I hear you say! Yes, Florida is known as a retirement destination, but here in the Sarasota area we enjoy much more diversity in our population. This became very apparent to me recently when I was doing some research to compare and contrast Naples and Sarasota as destinations for retirement and vacation properties.
I was invited by the Naples Board of Realtors to make a presentation to their members about Sarasota and how our lifestyle and real estate options compare to those in Naples – we often see buyers from outside Florida visiting both cities and deciding where to make their new home. My research revealed some interesting facts about the demographics of both areas. While the most recent census showed that Sarasota and Naples both had 29% of their respective populations aged 65 and over, the median age in Sarasota was 43.8 years compared to 64.9 years in Naples. So younger people are buying homes here! We are seeing younger retirees, but I have no doubt that our excellent school system encourages families with children to relocate here, and that drives down our median age significantly.
My research also showed that the median household income in Sarasota was $48,826 compared with Naples median household income at $54,406. But a quick look at real estate prices revealed Naples residents would need the additional income as their homes can cost between 15% and 20% more than comparable homes in Sarasota.
Many relocating retirees start by purchasing a part time or vacation home, and gradually increase the amount of time they spend here each year. Some of the needs for this group of buyers are met by traditional condominiums and “lock-and-leave” maintenance-free communities, or so-called 55+ communities. However, recent trends in new construction have proved that these buyers want more. We have seen a surge in demand for homes in communities that offer an active lifestyle. Typically these developments will offer a club house and range of amenities, together with the services of a Lifestyle Director, who will organize everything from exercise classes to book clubs, to trips to the theater and much more. In our own area, Taylor Morrison started this trend with their Esplanade development in Lakewood Ranch. The concept proved so popular they built, or have under development, similar communities close to Siesta Key, in Palmer Ranch and in Palmetto. Not to mention Naples and other “retirement” states who quickly embraced the concept. Neal Communities and Del Webb are also active in this sector of the market. Retirees are getting younger and demanding more!
Rising real estate prices have caused some people planning for retirement to make their home purchase sooner rather than later, and this has created a different demand for homes. Younger people are buying homes that they will use as a stepping stone to the retirement home of their dreams. They see prices rising. They also see a strong demand for long term rental properties. They respond by purchasing investment properties now, using them to generate rental income, with a plan to sell the property later to fund the purchase of their dream retirement condo on the beach, house on the golf course or in their choice of active lifestyle community.
Perhaps the most encouraging trend I have observed recently is that the number of local buyers we have in the market is on the rise. Residents now feel confident enough in our economy and their personal finances to buy that larger home for their growing family, or to downsize now they are empty nesters. Mortgages are more freely available to help these buyers, and their movement is helping us achieve a balance in the market, where we are no longer reliant on retirees and investors from out of the area.
So who are the buyers? Not just retirees from out of state/country, but people like you and me – local residents who see value in our area and plan on staying a while!
[1]Patricia Tan was born in England, and her career in international sales and marketing led her to live and work in many countries around the world before moving to Sarasota in 1997. Patricia is a Certified International Property Specialist (CIPS), Graduate Realtor Institute (GRI), and Transnational Referral Certified (TRC). She is involved in global activities of the Sarasota, Florida and National Association of Realtors, and currently serves as NAR President’s Liaison to U.K. Her real estate business operates from Coldwell Banker on St Armands Key, where her focus is to bring international buyers to the local market. She regularly makes marketing trips to Canada, Asia and Europe, to promote Florida’s Gulf Coast and the Sarasota area in particular. Patricia may be reached at 941-504-9232 or Pat@PatriciaTan.com [2].
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