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Transient Vs. Non-Transient: The Real Key West Facts

One thing you need to know when considering investing in Key West real estate is that there are two types of vacation rentals in the City of Key West; transient and non-transient.

A property with a transient license can rent like a hotel, by the night.  A non-transient licensed property requires a minimum 30 day lease.

Transient licensed properties allow for more rentals per year and as a result you can expect to see returns of 10-12% on the gross purchase price. The City of Key West used to issue transient rental licenses for a nominal fee to those homeowners who wished to rent their homes by the night. They stopped issuing those licenses quite a few years ago, but grandfathered all licenses that were in existence.   The result?  Think NYC taxi medallions, but on a smaller scale of course.

As a result of the high demand and limited supply, transient licensed properties have been selling at a premium and even above asking price in some cases.

Non transient rentals are required to have a month long lease (minimum 28 days) and can expect to see 5-6% return on their gross purchase price.  Although non-transient rentals can expect to see a bit less in rental income they also come with a lower price tag.  You are probably asking yourself if there is even a market for month long rentals in Key West.  The answer is yes, absolutely!  Last Key Realty manages over 100 luxury vacation rentals and more than half of them are non-transient.

The type of vacation rental you purchase depends on what your needs and wants as a homeowner are.  Whether you are looking for maximum return, a seasonal home, or both I am uniquely qualified to help you choose the perfect home for your needs!  Contact me today to talk more about investing in Key West real estate.

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8 Feel Good Things From Hurricane Irma

Hurricane Irma brought a lot of devastation to the Florida Keys there’s no doubt about it.  But in the wake of Hurricane Irma the Florida Keys community is coming together as they always do.  Here are 8 awesome things that have happened in the in the Irma aftermath:

The prosecutor from Miami who drove to the Florida Keys with his own grill and 300 pounds of chicken to cook for all the military and first responders helping with the Hurricane Irma relief efforts.

The guy who gave his beach umbrella to the National Guard so they could have some shade while handing out FEMA supplies.

It just didn’t feel right seeing the National Guard in full uniform standing out in the middle of a field in Bahama Village handing out MRE’s, water, and ice with no shade.  One Key West man took them over his beach umbrella to offer a little bit of shade and it wasn’t long before the troops were taking turns under the small shady refuge.

UPDATE:  Additional tents and umbrellas were added as the week went on. 

The little girl who went to a disaster relief center in Orlando and donated her bunny to the cause.

We were waiting in line at Publix and a police officer came up to us.  There was a little girl in one of the Orlando drop off centers for Key West relief and she wante to give her bunny to a little girl in Key West who was affected by hurricane Irma.  The officers promised the little girl and took the bunny to Key West.  It was her most favorite stuffed animal that she slept with every night.  Our niece was the lucky recipient of the bunny and she is in good hands.

 

People of Key West hosting block parties and sharing Irmageddon stories and a hot meal.

Last Thursday night there was a block party in Bahama Village.  Bradley Garrison said the locals were “serving up strip steaks and lobster tails to some great people.  Beautiful stuff.  Wouldn’t wanna be anywhere else.”

 

801 Bourbon hosted a “Get off your ass and help” block party.

801 Bourbon Bar was one of the first businesses to open back up after the storm had passed.  People needed to get out of their houses and shelters.  They needed a place to go that had people they could share their experiences with and also a laugh and a cold drink.  801 Bourbon rose to the occasion.  The Red Cross delivered hot meals outside of their bar and they hosted a “Get off your ass and help” block party where locals got together to clean up Duval Street proving that block by block, Key West will rebuild.

 

The Conch Republic Recovery Corps was born.

Craig Wynn of CrossFit Mile Zero in Key West created a group on Facebook called The Conch Republic Recovery Corps.  “The purpose of this group is to coordinate recovery and relief volunteers and efforts in Key West and the Lower Keys.  The damage by Hurricane Irma are extensive and all available help will be needed for our island community to recover.”

“If you would like to help with general clean up, repairs and maintenance, relief aid distribution, or any other specialty jobs that may need to be fulfilled please join this group.”

Recovery needs are posted within the group and if the members have any specialty skills, trade craft, or tools they state so in the comments.  It’s really been wonderful to have a place to go to see needs in the community and be able to immediately respond.

 

 

“Service Above Self”

The City of Key West and The Lower Keys felt the power of the Rotary Clubs their motto “Service Above Self”.  Several of the District 6990 clubs put together the Rotary Disaster Relief supply chain.  On Monday, 9/18/2017, a DC-3 cargo plane that flew in the Berlin Airlift brought more than 5,000 lbs. of supplies to be dispersed in Key West. Additionally, Rotary club members from Key West to Marathon are coordinating distribution to reach those with the greatest needs.  Supplies were staged in an empty commercial space in Key West and the doors opened on Tuesday afternoon to a line of people waiting to get their essential items.  Diapers and coffee were the first to go.

 

This little golden pig that survived the storm. She’s weathered the storm and like all survivors probably has one hell of a story. 

 

If you have a feel good Irma story please share!  There are a lot of great things happening out there!

 

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State of the Real Estate Market: Q1 Key West

The average listing price in Key West* as of March 2017 was $823,045 which is up 11.99% from last years average listing price of $734,904.  The average sale price in Key West* also took a giant leap from last year with an average sale price of $760,804 compared to 2016’s $637,184; a 19.40% increase.

What about time on market, how long are these houses sitting on the market before going under contract? The average time on market was 119 days compared to 2016’s 132 days; a 9.85% decrease. Homes in the $350K-$650K range are “flying off the shelves”, accounting for almost half of the residential sales YTD for 2017.

Key West is one of the hottest vacation rental markets in the United States, topping Forbes list in 2015 as America’s #1 vacation destination.  While home prices have been on the rise in the Florida Keys there are still excellent investment opportunities available for the savvy buyer.  For a home with a transient rental license you can generally expect between 8-10% return on your gross purchase price.  For a home with a non-transient rental license you can expect between 4-5% return on your gross purchase price.