Florida Real Estate Blog

A recent MSN Real Estate article tries to provide data to help make the rent or buy decision easier. The article pulls data from a study of the 100 largest metro areas in the US, 9 were in Florida. Of the 9 areas, 2 were cited as better areas to rent, 7 were better places to own a home. To find out where your area ranks, read on.

To make things easier on you, the Florida resident or future Florida resident, I have extracted only the Florida data and organized it into tables. A good rule of thumb: if your home costs more than 15 times the annual average rent for a similar home in your area, it is overpriced.The following is the data and a helpful explanation of the study’s findings.

Based on the study, two Florida metro areas, Miami-Fort Lauderdale-Pompano Beach, and Cape Coral-Fort Myers are overpriced. The study recommends renting in these areas as the values of homes are predicted to drop by 2012. See chart.

On a positive note for home owners, Orlando-Kissimmee, Palm Bay-Melbourne-Titusville, Jacksonville, Sarasota-Bradenton-Venice, Deltona-Daytona Beach-Ormond Beach, Tampa-St. Petersburg-Clearwater, and Lakeland were all identified as good places to buy a home.

Chart 1 shows the difference between renting and buying in Florida metro areas. A negative difference (in red) shows that renting may be a better choice.

 

	BUY		RENT
Metro Area	6% loan	7% loan	2-BR rental	3-BR rental	Cost diff. between 6% loan and 2 BR rental
Miami-Fort Lauderdale-Pompano Beach, Fla.	$1,636	$1,867	$1,035	$1,324	($601)
Cape Coral-Fort Myers, Fla.	$1,236	$1,410	$886	$1,204	($350)
Orlando-Kissimmee, Fla.	$1,232	$1,405	$915	$1,146	($317)
Sarasota-Bradenton-Venice, Fla.	$1,231	$1,405	$1,002	$1,280	($229)
Palm Bay-Melbourne-Titusville, Fla.	$1,016	$1,159	$815	$1,098	($201)
Jacksonville, Fla.	$997	$1,137	$816	$1,024	($181)
Deltona-Daytona Beach-Ormond Beach, Fla.	$985	$1,124	$845	$1,093	($140)
Tampa-St. Petersburg-Clearwater, Fla.	$1,008	$1,150	$883	$1,119	($125)
Lakeland, Fla.	$730	$833	$745	$945	$15

Chart 2 shows the projected equity by 2012 that would be accumulated by purchasing a home.

 

Equity by 2012
Metro Area	6% loan	7% loan	8% loan
Miami-Fort Lauderdale-Pompano Beach, Fla.	-$33,172	-$35,786	-$38,047
Cape Coral-Fort Myers, Fla.	$1,321	-$653	-$2,362
Orlando-Kissimmee, Fla.	$9,400	$7,433	$5,730
Palm Bay-Melbourne-Titusville, Fla.	$23,090	$21,467	$20,063
Jacksonville, Fla.	$26,832	$25,241	$23,863
Sarasota-Bradenton-Venice, Fla.	$31,544	$29,577	$27,875
Deltona-Daytona Beach-Ormond Beach, Fla.	$36,217	$34,643	$33,281
Tampa-St. Petersburg-Clearwater, Fla.	$41,847	$40,237	$38,843
Lakeland, Fla.	$56,960	$55,793	$54,784

By viewing these charts together, a case can be made for renting or buying in a certain area.