Zillow says you should buy vs. rent if you live in Southwest Florida.
The Seattle-based real estate data collector says in a recent survey that people in Lee, Collier, Charlotte and Hendry counties have better odds than most of the country of coming out ahead if they buy a home.
Nationally, buying is a good decision for people who plan to stay in the home for at least two years, according to an analysis of first-quarter financial data.
But what Zillow calls the “breakeven horizon” is much shorter here, the Fort Myers News-Press says: 1.1 years for Lee County; 1.0 for Collier; 1.1 for Charlotte; and 0.7 for Hendry.
Commercial real estate agent Jim Garinger of Colliers International Southwest Florida said Zillow’s analysis is borne out by what he sees in the apartment complex market.
The Apartment Complex Market
“Traditional apartment complex occupancy has become stronger over the past 12 months or so,” he said. “There’s been a significant increase across the board but especially in Class B apartments.”
As that’s happened, rents have increased as well, Garinger said.
The average apartment complex in the Fort Myers area in March had a vacancy rate of 96.7 percent, which was up by 1.8 percent from March 2013, according to Carrollton, Texas-based ALN Apartment Data.
In the same period, the average monthly rent rose 7.9 percent to $920, says ALN’s report.
Even as occupancy rates and values rise for apartments, however, lenders are still skittish about financing multi-family housing, Garinger said.
“Lenders are still looking at comparable sales as distressed properties,” which makes them reluctant to finance purchases or new construction, he said.
That problem will resolve itself with time, Garinger said, but meanwhile “If you’re a renter, it’s a great time to buy if you can swing it. As occupancy rates increase, rents are increasing as well.”
Home prices are also going up and interest rates are still historically low, contributing to the advantage of buying, he said.