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Wednesday, September 9, 2009

415 Julia Street - Old Town - Key West - Short Sale





415 Julia Street is located a hop, skip, and a jump off of Duval Street near Truman Avenue. The reason the location is important is that the location is important. You see this property qualifies for a transient rental license. That means the owner could legally rent this property on a daily basis. Having a good property in a good location could mean good income. (415 Julia Street does not have a transient license at this time.)

This property sits just west of the Duval Gardens Bed & Breakfast and a bit south of the recently updated Orchid Inn. There is a big redevelopment project CLICK HERE right at the corner of Duval and Julia. I like it when other people spend a lot of money near a property that is for sale. It reinforces the belief that the location does have value.

415 Julia Street is about a five block walk to South Beach where you can lay on the beach all day long. It is steps from Duval Street where you can do the Duval crawl. The world famous La Te Da and other fun spots are all located within a two or three minute walk.

CLICK HERE to view the current mls listing information sheet provided by the current listing Realtor. There are no photos. The property is described as "Great Old Town location. No kitchen, was once a guest house, zoned for transients. THis is a potential short sale." 415 Julia Street is offered at $450,000 for this 2324 sq ft property that has 4 bedrooms and 4 1/2 baths. CLICK HERE, CLICK HERE, and CLICK HERE for other photos of the property. THIS is the little house next door.

I have not been inside this place recently. Our office listed and sold this place in October 2006 for the price of $795,000. CLICK HERE to see some good photos of what the property looked like then. The property most likely will not look the same today. So please do not assume that it does. But the photos may give you an idea as to what you might be able to recreate.

Please call me, Gary Thomas, 305-766-2642 or e-mail me at kw1101v@aol.com if you are interested in this or any other property in Key West. I am a full time Realtor at Preferred Properties Coastal Realty Inc. in beautiful Key West, Florida. You could be here or Peoria. Which would you prefer?

11 comments:

Anonymous said...

Would this be possible to convert in to a guest house again, Gary?

Having owned a guest house before, do you know what the density restrictions, if any, are for lots and transient units? Hopefully I'm making myself clear. For example, in Wilton Manors, FL, each transient unit accounts for .5 dwelling units with a max of X number of dwelling units per acre.

Gary Thomas said...

The city normally requires one license for each guest room. According to the revious listing agent this property was operated as a small guest house. It had two licenses. Those licenses are not included in the current offer.

Three transient licenses are offered in the Key West mls for $16,000 EACH.

City of Key West zoning allows transient licenses to be moved to HRCC-1 & HRCC-3 districts. Transferability and receiver sites must be confirmed/approved by City of Key West.


Gary

Anonymous said...

Correct me if I'm wrong, but weren't transient licenses going for upwards of $200k a couple of years ago? Or is that something my feverish mind has cooked up?
Diana

Gary Thomas said...

I don't think any sold for such a ridiculous price. I know some did sell around $45,000 EACH.

There are many guest houses in Key West that currently rent more guest rooms than they have licenses. The City knows is. The County knows it. It's been going on for years. There is always the possibility some official may enforce "the law". But so far nobody has. One Realtor explained it to me by saying that the County is happy as long as it gets its share of the revenue in the form of the bed tax each guest house collects for each night there is a head in a bed.

Gary

Anonymous said...

Hi again, Gary,

I was aware of the transient licenses but wasn't sure of the density. I guess you could have as many rooms the building could fit provided you have the transient licenses for it?

The city code isn't clear on restrictions for operating a guest house besides what zones they may be in.

As another example, there's a house on Truman Ave., MLS #111471. I see it's in HNC-1 which says there can be no reduction of on site permanent housing. I guess that's what gets me. What do they consider reduction? A person bought the house and lived on site as the innkeeper, is this a reduction in permanent housing?

Sorry for all the questions. I'd like to move down but would need something to do.

I'd love to buy your old place but don't have $6M to dish out!

Gary Thomas said...

The City does not want to convert usable living space and convert it to commercial space. But I think rules permit conversion to temporary or transient living.
You would need to consult with an architect or attorney or to speak with a planning department official about a specific property to determine the rules that might apply to that situation.
Local real estate attorneys can be very helpful in creating ways to sometimes achieve the impossible.

My old guest house (511 Eaton) is not worth $6 million. I wish it were. And I wish I had never sold it. But it still is not worth the asking price.

Gary

Anonymous said...

If you want to own and operate a guest house, buy one already on the market. To go about dealing with HARC, zoning, transient licenses, etc. would be more headaches than it is worth. Trust Gary - he owned and operated a guest house in Key West for years. Plus, although transient licenses can be bought to transfer one, even if it is in an allowable area, can be a major problem. Plus, why go through all the frustrations to convert when you could just buy an already established guest house that has everything in place including website, advertising, client listings, etc.

Gary Thomas said...

Dear Anon - Your check is in the mail.

Seriously, most people don't have the kind of money to buy a guest house these days. 415 Julia Street would not actually be a guest house but it could be rented daily. It is worth looking at.

Gary

Anonymous said...

That's exactly right, Gary (and other Anon!) the cheapest guest house on the market looks to be 537 Caroline (old Bananas Foster) for $1.9M. The cheapest operational one now is the Grand at $2,050,000. Both are out of my price range, but besides that, I wonder if they could even sustain a mortgage based on room revenue.

For example, Gary's old place is listed at just about $6M. Even with the 19 rooms it sells, would be almost $40K a month for 30 years with a rate of 7%. I'm not sure who's going to give you 7%, either, maybe the tooth fairy.

I can only imagine the regret you feel from selling it, Gary. If you had to put a price on what you think would be a fair price for it, what would it be?

Gary Thomas said...

It's probably better that I not answer the last question online.

I can say that a bank will only lend based on a valid current appraisal. I doubt than any of the currently listed guest houses would appraise at the asking price.

Also, local banks will only lend based on the number of rooms that have valid transient licenses. So phantom rooms cannot be used to justify higher prices.

Gary

Anonymous said...

Party pooper :p

j/k

Thanks for answering my questions :)

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The information on this site is for discussion purposes only. Under no circumstances does this information constitute a recommendation to buy or sell securities, assets, real estate, or otherwise. Information has not been verified, is not guaranteed, and is subject to change.

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Key West, Florida, United States
I first read about Key West in a magazine called "After Dark" sometime in the mid 1970's. But it wasn't until March 1984 that I made my first visit to the island that would become my home. I had two weeks for a vacation and reserved a room at Colours Guesthouse (now Marrero's Guest House) for one week. I thought that if I didn't like Key West, I could always go back to Miami or Ft. Lauderdale for the rest of my trip. But after a couple of days in Key West, that was no longer a consideration. But when I wanted to extend my stay for the extra week I found there was no room at the inn. The guesthouse owner did find me a room at LaTeDa, the infamous guesthouse/restaurant. That's a story I'll write another day. But those two weeks in Key West gave me the realization that I had found Paradise. Key West has been my home since 1993 and my only regret is that it took me so long to get here. I am a full time Realtor at Preferred Properties CRI. Let me help you find your new home or business in Paradise. Living in Paradise is not a slogan, it's a way of life.