Tuesday, May 15, 2012

Palm Beach County is Ripe for Single-Family Home Investors

Palm Beach County, Florida- Many Investors are searching for West Palm Beach real estate listings. The Palm Beach County area has plenty of wonderful homes for sale and check out the West Palm Beach, Florida market. Now the news wire states that West Palm Beach, as well as Fort Lauderdale offer the greatest returns for single-family home investors. Palm Beach County Real Estate Investors are starting to look at what were once riskier deals and are willing to take on more risk to get returns.

Palm Beach County and Broward County Real Estate Investments

Palm Beach County Real estate investors who are seeking to rent out single family homes would be wise to head to South Florida. Various Real Estate Specialists see the South Florida Market as an area ready to thrive. The Federal Government has many problems and has thrown us all for a loop. We can just blame Mortgage Companies as many Banks were forced to hand out Mortgages with the Community re-investment act.

Houses and Condos in Boca Raton Florida are Now More Affordable

We have some information for newer investors in the Florida Real Estate market. The definition of 'Capitalization Rate' is for all to see and use to hopefully get a positive cash flow and nice return. A rate of return on a Boca Raton real estate investment property based on the expected income that the property will generate. Capitalization rate is often used to estimate the real estate investor's potential return on his or her investment property. This is done by dividing the income the Florida property will generate (after fixed costs and variable costs) by the total value of the property.

Boca Raton and South Florida Seeing High Cap Rates?

Capitalization rates (Cap Rate) for single-family homes that are rented out averaged 12.4 percent in West Palm Beach, signifying the greatest returns among all the markets tracked by the analytics firm. Single-family homes rented out in Fort Lauderdale posted the third-best returns, offering investors a 12 percent cap rate.

Single Family Homes For Sale in Boca Raton

The national average cap rate for single family homes was 8.6 % in January 2012, down from 8.8 percent a year before but up from 5 percent in 2006. Many of the other investor-friendly markets were in the Midwest, such as Cleveland (12.3 percent cap rate) and Chicago (11.6 %).

Miami, on the other hand, actually posted a relatively meager cap rate of 7.7 percent, offering the worst returns among the nation’s largest real estate markets. Also the national apartment sector is expected to see improvement with positive rental rate trends over the next two years. The rental market is opening up many opportunities for Real estate Investors in Florida.

Boca Raton Florida Continues to be Hot Spot for Real Estate Investors

The high cap rates are a result of strong demand among Americans for rental properties, even as housing affordability sits at its highest level in more than 20 years, according to the report. Rental closings increased 11.5 percent year-over-year in 2011 and comprised 29 percent of all single-family closings. By comparison, rental closings represented just 11.3 percent of all closings in early 2006. Meanwhile, sales closings declined 9.8 percent between 2011 and 2010. The truth is that rental demand is so strong that supply is now at its lowest level in the last five years even though the volume of rental increased 2.6 percent over the last year.

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