Girlfriend, Yogi Berra said it best: "It ain't over till it's over". And it ain't over.
I was showing property a couple of days ago to a potential buyer. We were driving to our next appointment when she mentioned the escalating prices in Key West and questioned the sustainability of market. I told her then what I have written here for all the years of my blog - that there is only one Key West. Buyers continue to want to buy here. There is a limited supply of both houses and land. State law limits new housing and city law restricts the size and height of what can be built even more. Prices will continue to rise as demand is higher than the supply. It ain't over.
3 comments:
Gary you are correct with continuing rising home prices in Key West. You represented me as a buyer on a home purchased less than 4 years ago, that I purchased at basically full asking price. You gave outstanding advice to purchase the home, I thought I was over paying. The home has appreciated greatly since the purchase.
I would not be remotely surprised if no free standing home on the island couldn't be purchased under 1M in the next 5 years.
I have a soft spot for the cottage represented by your "1010" sign. We rented it for February 2008 and loved it and Key West so much we went out and bought our first house. I was with a lawyer friend this morning who said he's never been busier in all his years here. Key West has a "secret sauce" that I doubt exists anywhere else. At least not for me. Prices will continue to rise IMHO. And with inflation straight ahead, buying real estate now makes good sense.
I hate to throw a wet blanket on the current buying frenzy, which by the way is happening around the world, but the end of the road for the real estate market in Key West is on the not too distant horizon. It will be caused by the elephant in the room that nobody wants to talk about. The sea level has risen about 6" in Key West since the big flood caused by Wilma back in 2005. The number and severity of hurricanes is on the rise worldwide due to climate change. As a result the cost of flood and wind insurance in KW has become outrageous and is accelerating each year at a staggering rate. Real estate deals are already falling apart when buyers, who must buy insurance because of a mortgage or who are cash buyers who are uncomfortable with self insuring, back out due to insurance price sticker shock. The bottom of the market will always depend on mortgages and without insurance mortgages are not possible. Eventually the house of cards slowly begins to collapse. The question is not if but rather when.
Post a Comment