Something New under the Sun

Scarcity creates value. That's why I think real estate in Key West is such a great value--even at today's prices because you can't grow the island any bigger than it is. Or can you?

Key West enacted an amendment to the city charter to restrict growth by limiting height and density of construction and renovation. There has been a big legal battle over redevelopment of the Jabour Trailer Park into waterfront condominiums. A similar battle was waged over redevelopment of the Atlantic Shores Resort into high-end ocean front condominiums. That case went to the Circuit Court of Appeals that reversed a ruling of the Monroe County District Court that misinterpreted the city ordinance.

But any time somebody wants to build something to increase the present use of a big piece of property it is almost assured that someone else will get their nose out of joint and want to interfere in the process. Not being judgemental. Just stating the facts.

Over the next couple of weeks I am going to mention several new development projects in Key West that may appeal to a variety of potential buyers.

Today's entry are eight new Victorian homes situated in the Heart of the Meadows in the 1500 blocks of Petronia and Pine Street. The Meadows is located within easy walking distance to Duval (about a 15 minute walk.) Each home is different is size, design, and price. Prices range from $1,695,000 to $1,995,000. This is a secure and gated community with private carports & indigenous landscaping. Pascal Delisse Interior Designs has created stunning interior schemes and will provide endless custom options with early purchase. Features include vaulted ceilings, hardwood & travertine floors, chefs kitchen with custom cabinetry & granite counters, luxurious master suite, dramatic custom lighting, impact windows, breathtaking patios & porches and individual private pools. The neighborhood itself is getting quite a makeover. A separate waterfront development is going on across the street (Eisenhower Drive). And the home directly across the street to the north has just been completed renovated. That house takes up 1/2 the city block and will add value to all homes around it. That my friends is a given in real estate.

Click the tile above Something New under the Sun for more information on these homes.

Life in the Slow Lane

Life in the Slow Lane

That's what life is for most of us fortunate enough to live in Key West year around. But for those Key Westers who really live on a lane, life is more slow and much more quiet.

I am speaking of course of the 104 named lanes in Old Town Key West. In 1980 a Conch named C.W. (Billy) Pinder prepared a history of Key West lanes for the City Commission which he subtitled "A Bit of History, A lot of Dimension". He recited the name and location of each lane and suggested in his forwarding Memorandum that "the Police, Fire, Sewer and our department has expressed interest in this booklet" inferring that a lot of people in responsible positions did not know where some of the lanes were located. And to no wonder the reason why: several lanes have more than one name.

Here are but a few of the lanes for your edification: Billygoat Lane is also known as Hibuiscus Lane and the entrance is located next to 512 Grinnell Street. Carey Lane is also known as Thompson Alley (not to be confused with Thompson Lane -- there are two of those) and is located on Margaret Street near the sexton's office to the Key West Cemetery. Du Pont Lane is a dead end off the 500 block of Petronia near Duval and is also known as Titanic Court. Then there is Goat Alley also known as Carson's Lane. Of course is located on the north side of the cemetery and is now referred to as Angela Street. One of my favorites has always been Graveyard AlleyGruntbone Alley (also now known as Peacon Lane). We have a Love Lane, Passover Lane, Poorhouse Lane, Whalton Lane (not to be confused with Whalton Street--but people still get confused!), Wong Song Alley , and the two Thompson Lanes--one in Bahama Village and the other a mile away near the new Strunk Ace Hardware on Eaton Street.

Key West lanes are very special places. Most are dead end streets that are but one lane wide. Some lanes actually go for two blocks and a couple of those connect to through streets on both ends. But most are just dead ends. And that's what makes them special. You see tourists usually can't find them, motor scooter riders go too fast to see them, Conch train and trolley car drivers drive past because they can't drive in. So life goes on in these little islands within the island that is Key West.

When I am working with customers looking to find a dream home in Key West I extol the virtues of lane life.

The house to the right is a new renovation on Carey Lane. There are three houses on this lane with almost identical original facades and construction. The houses on either side were enlarged and pools added earlier. And this last house was completed in 2005. Totally redone, top to bottom and includes a separate guest cottage and sparkling pool. It's a 3 block walk to Duval and a 3 block walk to the seaport. So close, so far away. So quiet at night, and during the day.

Life in the Slow Lane, ain't it a drag.

Sunday Special

Sunday Special

Actually, you can buy this lovely totally renovated compound in Old Town for $1,849,000 any day of the week. But it is a very special house, and here's why:

Two of my friends from my former office are multi-million dollar agents year after year. During their time off from their busy real estate practice, they renovate homes for fun and profit. They design each property for a discerning buyer and oversee all of the construction to make sure the work is done to their standards. This home was their crown jewel in Key West.

This property at 709 Bakers Lane is just two blocks from Duval on Solares Hill--the highest point in Key West. The compound is actually two homes plus a guest cottage that is
hidden away just off Elizabeth Street.

Each building was thoughtfully renovated to provide separate living spaces for the owner and family or friends. The great room in the main house features two chandeliers from a historic Chicago theatre. The kitchen has all the bells and whistles one would expect. The second floor is devoted to the master bedroom and bath plus a second floor terrace overlooking the pool below.

The guest house features a living area, kitchen, and two bedrooms and two bathrooms. James Leo Herlihy wrote Midnight Cowboy in this house.

On the opposite side of the free form pool sits the guest cottage which has a butler's kitchen, huge bath, and laundry room.

The new pool and swim under waterfall are truly inviting. The balance of the courtyard is paved with Chicago brick and handsomely landscaped.

The house was originally designed and built to sell for $2.8 million. The real estate market took a nose dive and the owners decided to leave Key West for a variety of reasons. The home is now priced at a very reasonable price. The home is not for everyone because the main house has only the master suite for sleeping. But an individual or couple with no small children might find the two separate guest houses just the ticket.

There are two ROGO units on this property meaning that the owner could legally rent one or both homes as vacation rentals. (Lots of rules--not discussed here.) I did a quick comparison to similar properties managed by At Home in Key West and Rent Key West and I believe this home could be rented as a vacation rental during season for $12,000 to $14,000 per month.

I truly believe that now is the time to buy quality properties in Key West like this jewel, because most are underpriced and way undervalued. When the real estate market makes its next correction, this property will not be afforable by many who can afford it now. The spike in value will be appreciable.

This is not my listing, but I would love to show this property to you. Click the title above for more info on this property. And call me at 1-305-766-2642.

The Best Buy in Old Town

The Best Buy in Old Town!

912 Fleming is a really big house with a beautiful pool on a big lot on a great street with really expensive neighbors. And it is priced to sell.

Here's the skinny. The previous owner was a designer who renovated numerous properties in Key West for himself and clients for several years. He had purchased the house next door (at 916 Fleming)and was renovating it when he passed away early in 2006. His estate sold the project house for $1.5 million (the house was gutted and was basically a very expensive "shell"). That property is pictured to the right and shows how it looked in January 2006 and February 2007. It is almost finished.

The house at 912 Fleming is 3228 square feet on a 5650 square foot large--fairly large for Old Town. It has 4 licenses and the owner rented two apartments located at the front of the home and he lived in the rear--most of which was newly constructed by him during his renovation in 1997-98.

The home is perfectly liveable "as is", but a new homeowner may want to eliminate the rentals and expand the living space to the entire house. And here is why: the neighbors.

The house next door at 908 Fleming just sold for $3.6 million ($1,158 per square foot) and is undergoing a massive remodel. That house is huge and has a huge lot. And just next door to 908 another new house is being built. The house across the street at 911 Fleming is on the market for $4,675,000 or $1,509 per square foot. That house also is huge and has a huge lot. See the trend: big houses, big bucks being spent.

The estate of the former owner has reduced the price from the original asking price of $2.6 million to $1,990,000 or $616 per square foot. That's a no-brainer in my book. Perfectly liveable as is. Great block and ready to go.

Not my listing, but I can help you buy this bargain today. Call me 1-305-766-2642. Click the title above "The Best Buy in Old Town!" for more info and pics on 912 Fleming.

All About the Benjamins

All About the Benjamins
One of the current media trends is comparing similarly priced homes in different parts of the country. The February 2007 issue of Key West magazine compares a home at 416 Elizabeth priced at $3,9 million to a home in Santa Fe and a home at 800 Amelia priced at $2,395,000 to a home in Malibu priced at $2,4 million. HGTV has a weekly program that does the same. In each instance price comparisons help potential buyers pick the best buy for the buck. So, by extrapolation, home buying is All About the Benjamins.

I started today on the treadmill at the gym, which lead me to consider the present value of big homes in Key West in the current market. There are 31 homes priced at $3 million or more in the Old Town area of Key West. With a couple of glaring exceptions, most are reasonably priced to sell in the current Key West real estate market or about 115% over the target sales price. There were seven sales of single family homes priced above $3 million in Old Town since January 2006. There is clearly a bigger supply of big houses than there are buyers. And come to think of it, there are a bunch of homes priced just under $3 million like the El Encanto I wrote about on January 26th.

I think some of these big homes are bargains. Some are under priced because the real estate market in Key West is currently undervalued as compared to other parts of the world. Some sellers must sell their homes and have priced them to sell. That is different from sellers who may sell if they can get "their price".

Our market does not compare to Miami or Ft Lauderdale. I think our market compares to other world class destinations, at least the upper end does. Many Europeans have second homes in Key West. The Euro and the British Pound are far more valuable than the American dollar which makes a second home in Key West or any other destination resort more affordable for wealthy Europeans.

The homes to the right tell us a story about what is coming in Key West. The house under construction at the corner of Whalton and Johnson Streets in the Casa Marina area is a prime example. I don't know the owner or builder, or the estimated construction costs. The owner bought the lot in 2005 for $1,850,000 and the new home will surely cost somewhere around $1.5 - $2 million to construct.

The house across the street at the corner of Whalton and Casa Marina Court sold in July 2006 for $3.4 million. It was previously owned by author Philip Caputo and had seen better days. There is a construction crew there now doing what they do--rebuilding homes in paradise. This house has ocean views and immense grounds. I expect the new owner will be spending in excess of $1 million on updating this home.

Another big house is going up at the Grinnell and Johnson Streets. The house next door is priced at $3.5 million. The house across the street (also shown with magnificent palms) was put on the market a couple of months ago at $3.5 million and went under contract within two weeks.

These homes in the Casa Marina area are expensive by Key West standards, but may be under priced as compared to homes in other destination resorts. I think they are buying opportunities.

What is my Key West home worth?

What is my Key West home worth?

One of the factors that makes Key West so interesting is the character of its architecture and the diversity of its neighborhoods. And those two factors have a great impact on how homes are valued for re-sale in Key West.

The Old Town area has four Principal types of homes: two story Greek Revival structures built in the late 1800's through the 1930's; "cigar maker's cottages" (often called shotgun style homes elsewhere) which are one story houses with a long hall on one side of the house with all rooms opening onto it; "eyebrow houses" which are two story homes with a center stairway leading to second floor bedrooms that have unique windows that are situated so that they may remain open during a rainstorm and are protected from the elements by the extended roof that resembles an "eyelid"; and fill in homes built throughout the years including some post World War II modern homes.

The mid town and Casa Marina areas have a mix of housing types with the typical being CBS (concrete block structure) as well as some sporadic "conch homes -- a mix of Greek Revival, cigar maker cottages, eyebrow homes".

The new town area is mostly single family homes built in the 1950's through the 1970's. Most of these are CBS construction. And there are many condos built in the 1990's through today.

Many homes, especially in Old Town, were neglected for years--maybe decades. As Key West has been revitalized, homes have been remodeled block by block, neighborhood by neighborhood. But not all homes have been remodeled with the same integrity or craftsmanship. Likewise, many homes in the other neighborhoods have been similarly remodeled .

Up north in America where many homes and neighborhoods are cut from cookie cutters, it is easy to extrapolate a home's worth based on what a similar home sold for. Realtors and appraisers do it all the time. Realtors' valuations are called "CMAs" (comparative market analysis) and are usually done as a tool to help obtain a real estate listing. Appraisers are licensed by individual states after completing coursework that teach them how to value real estate. They should be an objective third party who has no financial or other connection to any person involved in the transaction. Banks engage appraisers to evaluate the specific property and compare it to similar properties that have sold in the area or that are offered for sale. I recently spoke with one of the co-owners of a large Key West appraisal company. He said his company is having as much trouble keeping up with valuing homes in a declining market as it had when prices were rising just as rapidly a few years earlier. Homeowners and investors would be wise to use the services of an appraiser when pricing their homes for sale. Some Realtors pump the price up to secure a listing, and then recommend that the price be reduced after the property languishes unsold. Time is money is Key West just like it is anywhere else. The prime selling time is between late December through Easter. Sellers who have unrealistic prices, especially in the tight Key West market, will probably have their homes unsold.

The Big Bounce

The Big Bounce


I have lived in Key West for 13 years and have shared two major life-changing events during that time. The first was 911 and the second was Hurricane Wilma.

I was at the gym that fateful morning. Ron who worked the front desk said a member just called him and said two planes (a big one and a small one) had hit the World Trade Center. I knew the chance of that being an accident was impossible. I suspected the worse, but did not know what the worse was. I sped home on my bike screaming expletives. When I got inside the kitchen I turned on the tv to watch the horror as it happened. We all remember the madness as is unfolded.

I had afternoon floor duty that day and I questioned why we were keeping the office open. But I went as requested (I was at a different company then). Town got dead real quick. There was little traffic and hardly any tourists. They closed the office about an hour after I showed up. I drove out to Walgreens to stock up on vodka, knowing the next few days would be awful. The clerk did not really understand what had happened. I told him, and he got the most awful pained look on his face. He said he had heard that the navy had posted armed guards at Sigsbee. I drove out to see them. Yep, they had their weapons out.

Town (that's what a lot of call Key West) died that day. Business went away. Fantasy Fest occurred, but it was subdued. The tourists just did not return for the normal fall schedule of events.

Then the day after Christmas town bounced back---big time! And the dead real estate market exploded. The demand for real estate could not be met. Prices rose by double digits for Key West and the other Keys as well each year through 2005. Buyers started questioning whether the market could continue to grow at the rate it had for the previous 4 years. Reason suggested that the market would continue to grow, but not at the rate previously experienced.

By Spring 2006 (prime selling time in Key West) the market slowed a bit. Then we had four hurricanes. Each one brought CNN and other national media to report on the fools walking on Duval Street hours before each hurricane. They could have shown re-runs of the previous storms because each hurricane was the same--until Wilma. Yes, we had some damage with each hurricane. Usually the wind uproots a few trees that fall on roofs or a car. Some minor flooding, but usually no structural damage related to flooding. But Wilma changed that as well.

Hurricane Wilma brought wind and water damage from one end of the island to the other. Most of the Old Town area was spared flood damage. But the damage elsewhere was physically and emotionally devastating for most of us. People with nothing and people with very expensive homes and toys shared equally in their losses.

I rode my bike around town every day for over a month just looking at the piles of trash and debris piled in the streets. The winds and ocean water from the tidal surge took its toll on our lush green gem of an isle. The palms and ferns looked like hell. The small foliage we all see and enjoy seemed to disappear. The island was no longer green, but grey.

But one of the great things about living in Key West is the resilience of the people who live here. When someone is injured or gets desperately ill, there is always some fund raiser to help raise funds. The people who live here do care about each other. We really do care.

I wrote last week about the smell you experience when you get off the plane at Key West International Airport. The very next day my neighbor across the street who moved to North Carolina in the spring of 2006 was down to check on her house. She mentioned the smell when she got off the plane and noted how beautiful everything was again. She said she forgot how beautiful Key West is.

The pics to the right show a huge tree in the Battleship Maine's cemetery on White Street, a tree near the Casa Marina hotel that toppled during Wilma, a house on upper Duval that was being remodeled as it looked on Nov 17, 2005 and a pic as it looks today, Jan 30, 2007.

Key West bounced back from 911. I'm waiting for The Big Bounce to occur in the real estate market. It will come.

El Encanto

1400 Whalton Street, Key West, Florida 33040
Your new address!

I have been eyeing the remodeling of this house for about 3 years. I live a block away and had the opportunity to watch the daily progress.

The original house was a one story arts and crafts home from the 1920s. The owner is a local appraiser and his wife, a realtor. They announced they were remodeling and adding a second floor. They hired Tom Pope--a noted Key West architect to design the project and Bird Construction to build it.

It is located on a corner in the Casa Marina area of Key West. It is a short 5 minute car ride to Old Town or the shopping centers on North Roosevelt or the airport on South Roosevelt. And you can walk to the beach in 5 minutes as well. It is not near any tourist destination. One of the streets does get quite a bit of daytime traffic, but like most Key West streets, it is very quiet at night.

The exterior colors are are sea foam green and white, and they blend nicely with the lush palms and the mini-estate that is located immediately south of the home. The pics of the home to the right do not do justice to the beauty of this home. There are 5 bedrooms, 7 bathrooms, an interior and pool kitchen, a child's playroom or study (it is officially counted as a bedroom), and an inviting great room that overlooks the pool and park-like grounds to the south.

The second floor master suite has vaulted ceilings and finishes that transport you to a south seas isle. And there is a large walk-in closet with quality built-ins for superior storage. Every room is finished to the "T". Nothing has been overlooked. Nothing. It is, without a doubt, the most beautiful home I have seen in Key West.

Click the words El Encanto above to see more information on this stunning home.

U.S. Coast Guard - Key West Style

The U.S. Coast Guard - Key West Style

"What do 'coasties' have to do with real estate?", you ask.

Well they are a big part of the life in Key West. Their job is being part of Homeland Security and doing life saving chores, drug interdiction, port protection, and so on.

Many of the people live off base. So they compete for housing just like all of the waiters, bartenders, fishermen, shopkeepers, construction workers, etc. that compete for short term housing. A single guardsman with no dependants ranked E-2 gets $1452 to pay housing and utilities. Since most one bedroom apartments in Key West go for $1200 or more per month with the tenant paying all utilities. That can amount to an additional $200 to $300 per month in some cases.

Those high prices create the need for roommate situations. A two bed, two bath apartment, condo, or home will typically rent from $1800 per month and up plus utilities in most instances. Old Town housing is the most expensive. Properties with a pool, on-site laundry, off-street parking, or other amenities usually rent the quickest and at the highest price. The less expensive properties are typically located in the mid-town area (east of White Street to Kennedy Drive). The price differential is not all that great, however.

I advise investors who have apartments or homes they want to rent on a long term basis to try to rent to servicemen. As a rule these service men and women make superb tenants. They are neat, clean, obey the law, and pay their rent on time each month.

We're having a Party and you're invited...

We're having a Party and you're invited...

Anyone who reads this blog is welcome to attend a little cocktail party on Thursday, January 25 between 4:15 to 6:15 PM at 612 and 616 Olivia Street in Key West.

We are hosting the event to present two beautiful homes to Realtors and sophisticated buyers.

I am including a photo of 612 Olivia from 3 years ago and a photo taken last week. The old structure was demolished and the new home was recently finished. The home has 4 bedrooms, 6 baths in two buildings with a total of 3220 square feet of truly elegant living space. And that's just for starters.

612 Olivia was constructed for a particular owner who either has a large family or lots of friends. The rooms and public areas are spacious. And the pool, gardens, and terraces were designed for casual living and grand entertaining. 612 Olivia is offered at $3,200,000. Do drop in on Thursday and say hello.