As the county seat of Palm Beach County, West Palm Beach is one of the largest cities in the region and is a significant component of the Miami Metropolitan Area. It has a thriving population of nearly 121,000 according to the 2022 Census, and is known as a central hub for entertainment, economic growth, and enchanting sights. These make it one of the best places to consider for those looking to invest in residential real estate.
Interested? Here are some of the most compelling reasons why you should look for available single-family homes for sale in West Palm Beach, FL to add to your investment portfolio.
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WHY INVEST IN WEST PALM BEACH RESIDENTIAL PROPERTIES
People with an eye for good business will see the benefits of investing in residential properties in West Palm Beach for their consistent market performance and upward movement. July figures from Realtor.com reveal that homes in the city were sold for a median price of $372,500, indicating a year-on-year uptick from $319,000. Moreover, while other areas are turning into buyer’s markets, West Palm Beach continues to hold its ground as the playing field between buyers and sellers is more leveled. This translates to more units in their housing inventory being able to cater to the overwhelming demand.
West Palm Beach also allows for more affordable living conditions compared to other Florida cities and towns on the Sunshine State’s eastern shoreline. Its neighbor to the east, Palm Beach, has a cost of living index that’s more than twice that of the former – 216.3 to West Palm Beach’s 105.3.
Rental fees in West Palm Beach are also slightly lower than in the busier Miami-Fort Lauderdale-Pompano Beach Metro Area, making it a great option for young professionals. That’s why it comes as no surprise that West Palm Beach has a youthful, vibrant vibe. Studio rentals in WPB would have an average price of $1,210 compared to the Miami-Fort Lauderdale-Pompano Beach Metro Area’s $1,340. Meanwhile, a 2-bedroom rental in WPB would cost $1,800 monthly; in the Miami area, the average monthly rent goes for $1,890.
With these facts, there has never been a better time than now to cash in on the benefits of investing in residential properties in Orchid City, especially when you stand to gain the following.
Positive cash flow
By investing in one of the available multi-family or single-family homes and condos for sale in West Palm Beach, FL, you can look forward to a positive cash flow due to:
COMPETITIVE PURCHASE PRICES COMPARED TO OTHER REAL ESTATE MARKETS. As mentioned earlier, while the median price of single-family homes in West Palm Beach rose by a significant percentage compared to last year, properties here still stand as one of the most affordable in the country. And with the market being more balanced between buyers and sellers, you could negotiate for better terms and contingencies, as well as a price that’s within your allotted budget.
Prime waterfront properties still do command higher prices than the average single-family home, though, even going as high as almost $40 million. Nevertheless, these present a wide range of options for real estate investors looking to diversify their asset portfolio.
NO RENT CONTROL LAWS IN FLORIDA. This is probably one of the most powerful reasons behind the Sunshine State’s appeal among real estate investors, given its business-friendly atmosphere. However, certain conditions still have to be met before making adjustments in rent prices. While the time frame is not stipulated in writing, landlords must give tenants prior notice before raising rent.
Rising property value
Data from NeighborhoodScout.com reveal that home values in the city have been rising annually by an average of 5.68%. These gentle upticks over a span of more than two decades have led to a whopping appreciation rate of 260.90%.
These stats underscore the remarkable long-term earnings potential of homes in West Palm Beach, notwithstanding market fluctuations. Even a pandemic didn’t dampen interest in West Palm Beach real estate. Migration to the city and the rest of Florida only grew higher, given the more relaxed protocols, as well as the rise of the remote work concept that essentially untethered workers from their respective offices.
Home values could be boosted further with improvements to the property. However, note that some home upgrades are better than others at increasing the value of a home. Online trade newsletter Remodeling, in its 2023 Cost vs. Value Report, recommends the following top projects:
- HVAC conversions (e.g., from standard to energy-efficient): 103.5% recouped cost
- Entry door replacement: 102.9% recouped cost
- Garage door replacement: 102.7% recouped cost
- Stone veneer installation: 102.3% recouped cost
- Siding replacement: 88.5% recouped cost
Solid asset
Both property owners and investors know that real estate is one of the most stable assets one could have in their financial portfolio. It’s a tangible asset that won’t lose value even in the toughest market conditions. Compared to stocks and bonds, it offers a lot more stability and fewer risks. This stability makes it a reliable hedge against market fluctuations caused by circumstances like a ballooning inflation rate or a looming economic downturn.
Moreover, when you turn your West Palm Beach property into a rental, you stand to benefit further from your investment. If you bought the property on a mortgage, you could build equity from it then use the proceeds to invest in another rental to further diversify your asset portfolio. The same goes if you decide to put your property back on the market – you could use the earnings as capital for another real estate investment or other financial pursuits.
Long-term investment
As mentioned earlier, real estate is an asset that could withstand market upheavals due to its tangibility. This same characteristic also allows it to withstand the test of time. Whether you decide to put it up for resale after a certain period or hold on to it as your heritage for passing on to the next generations, your real estate asset will hold its value.
Steady income
The City of West Palm Beach is a popular spot for an eclectic urban lifestyle where business and pleasure come hand-in-hand. While primarily inland, it still provides easy access to some of the most stunning beaches on the fringes of the Atlantic. The Intracoastal Waterway on its east flank also provides a number of activities for water-based recreation. That’s why when you decide to invest in residential properties here and convert them into rentals, you can be assured of a steady stream of tenants needing a place to stay as they settle in West Palm Beach for both work and play. This translates to a regular source of passive income with generally high yields, given the city’s popularity among young professionals, tourists, and snowbirds.
Tax benefits
Florida is one of the few states in the country with no state personal income tax while offering exemptions for sole proprietorships. It’s this business-oriented mentality that has attracted many investors and entrepreneurs to the Sunshine State. As such, you can rest assured that you’ll be taking home a big chunk of earnings from your real estate investment.
Selling your property in the future? Florida also doesn’t have taxes for capital gains. You’ll still have to contend with federal capital gains taxation, but you won’t have to pay extra state taxes for the sale.
Stable base of renters
Of the almost 50,000 residences you’ll find in West Palm Beach, the percentage of homeowners and renters living in them is approximately 50/50. With households here literally split in half between these two segments, it’s undeniable that there’s a competitive rental market over in West Palm Beach. However, a 17.7% vacancy rate in the area signifies that there are still enough opportunities available to those looking to invest in residential real estate here.
Setting up your rental property now will allow you to take advantage of the ongoing wave of migration to the state; thus, ensuring that there will never be a scarcity of tenants for your rental in West Palm Beach.
THE WEST PALM BEACH HOUSING INVENTORY
Ready to choose? Here are several types of available residential properties for sale in West Palm Beach:
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Single-family homes – West Palm Beach has a diverse array of this property type, from quaint bungalows to sprawling historic mansions in Mediterranean Revival and Colonial Revival styles. The neighborhoods of Northwood, Flamingo Park, Grandview Heights, and El Cid are known to have historic homes that have been retrofitted with modern fixtures and amenities. Newer construction could be found in the communities near Downtown like the Southend, Ibis Golf and Country Club, and Worthington Estates.
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Condos – A plethora of mid-rises and high-rises peppers the West Palm Beach skyline. You practically find them anywhere – by the Intracoastal Waterway, in and around the downtown area, and in the historic districts. Among the most prominent condos in the area are The Bristol Palm Beach (found along the Intracoastal Waterway), The Plaza (found in Downtown West Palm Beach), and Flagler Pointe (found along North Flagler Drive).
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Multi-family residences – You’ll also find a good number of these types in West Palm Beach, particularly in the following areas:
- Northwood Village
- Clematis Street
- Palm Beach Shores
- Midtown West Palm Beach
- Downtown West Palm Beach
TIPS FOR FINDING THE PERFECT RESIDENTIAL REAL ESTATE INVESTMENT
Now that the concept of investing in residential rentals in West Palm Beach has become a full-blown idea, bringing it to fruition is the next step. Here are some tips to help you out.
Define your investment goals
From the start of your home-buying endeavor, your search process must be anchored on a defined set of goals. Putting these goals at the center gives you more direction in planning and execution, ensuring great profits at the end of the day.
Ask yourself the following questions to help you in your goal-setting:
- What are my financial goals?
- What is my risk tolerance?
- What is my budget?
- How will I finance my investment?
- How will I measure success?
The answers to these questions will enable you to jumpstart your plans, this time, with a more informed mindset.
Narrow your options to a select few
Searching for available homes online is a great way to start your home-buying endeavor. Once you have a list of potential candidates, you could further narrow your options based on several factors. These include:
LOCATION
If you want to target longer-staying tenants for your rental, finding condo/multi-family/single-family homes for sale in West Palm Beach, FL that are located near schools or the commercial district will allow you to reach out to the employed and family segments of the population. Meanwhile, if you plan to open a short-term rental, you could opt for properties by the Intracoastal Waterway or along roads leading to neighboring cities and towns with spectacular beaches and other attractions. Tourists will surely appreciate easy access to their desired vacation spots from your rental.
NEIGHBORHOOD
West Palm Beach has over 100 neighborhoods, each with its distinct vibe. To get the full set of benefits in investing in residential property in the city, it’s important to know where to best place your money in. Below are several neighborhoods of note.
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El Cid. This historic neighborhood boasts homes with Mediterranean Revival and Mission-style architecture, making it one of the most attractive addresses in the city. This is where you’ll find the Villa Medina Historic Reservation and the Ann Norton Sculpture Gardens. It’s also located near good schools, community amenities for dining and leisure, and Dixie Highway.
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The Southend. Also known as South of Southern or SoSo, this neighborhood spans from Southern Boulevard to the Lake Worth Spillway, all the way to US-1 and the Intracoastal. It’s popular among those looking for a quiet neighborhood near good schools and the waterfront.
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Lands of the President. For golf lovers, this gated community is nothing short of paradise. It is home to Banyan Cay Resort and Golf Club, which features an 18-hole Jack Nicklaus signature golf course, as well as resort-style amenities. It also offers diverse options in home types, from single-family homes to multiple living options.
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Grandview Heights. The homes in this low-key neighborhood are relatively more affordable than other options you’ll find in the city. It’s also close to Downtown West Palm Beach, Grandview Public Market, The Kravis Center, the waterfront, and the highway. It’s a historic town that was listed in the National Register of Historic Places in 1999.
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Flamingo Park. Also known for its Mediterranean Revival and Mission-style architecture, Flamingo Park is one of the most popular localities in West Palm Beach. It’s perfect for those who want to live close to the dining and shopping scene in The Square, the waterfront, and Downtown West Palm Beach.
STATE OF THE PROPERTY
A move-in-ready home is an ideal property that will allow you to receive new tenants at the soonest time. However, homes like these are more expensive as these are usually new construction. The next best (and more affordable) option is to find a home that will require minimal repairs and is relatively well-maintained. That way, you don’t lose too much time and money before opening your new rental’s doors to the public.
AMENITIES AND FEATURES
Certain amenities in a home will appeal to various segments. If you want to attract upscale vacationers, you’ll want to invest in a home that will provide them with amenities that run parallel to their high-end lifestyle. But if you are considering a more mass-based approach to your investment, then multi-family residences with standard amenities, fixtures, and appliances that are functioning optimally will serve you best.
Moreover, special features like a swimming pool or a game room in your rental could merit higher fees.
COMMISSION THE HELP OF A PROFESSIONAL REAL ESTATE AGENT
The knowledge and expertise of a West Palm Beach Realtor is valuable in every step of the real estate investment process. You can gain access to a wide range of listings, including off-market properties, from their network of colleagues in the industry and other trustworthy connections. Moreover, you receive professional guidance in navigating the technicalities of the process, leaving you with the least stress and life-changing information that will help you in making informed decisions throughout the journey.
In South Florida, you only need to rely on one Realtor to provide you with the services you need in your transaction – yours truly, Suzanne Frisbie. With extensive experience dealing in real estate in Coastal Palm Beach County since 1988, I could guide you toward the best investment property that matches your requirements.
Let’s begin your journey toward making your investment goals a reality! Call me at 561.373.0941 or send me an email here.