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Buying a waterfront home in the Keys


First off, congratulations on looking to the Keys for a possible
vacation home. The good news about the Keys from an investment
angle is: There is only so much waterfront or Coastal property
available. The Keys have strict environmental laws that affect
building permits. This means there are only so many homes and
always will be a limited number of homes here.

One big reason
for this is there is just ONE Highway in and out of the Keys.
(US1) If there is an emergency, people need to have the ability
to leave quickly and so for this reason alone, the Keys will
never be California. The other main environmental consideration
is water quality. The Keys' main attraction is water sports
and Monroe County is going to make sure that our waters are clean
and usable. To consider when purchasing any waterfront vacation
home and how the Keys measure up: Is there a view? Views really
do matter. An unobstructed Ocean view adds as much as 60% to
the value of a home per the Journal of Real Estate Finance and
Economics. Proximity to Golf courses or a park can add as much
as 20% to a home's value. This is per an article by a much-published
an author named Soren Anderson, a writer from Manchester College.

Consider the recreational activities…

The What and the When. For example in a Ski resort area, your
options are limited due to weather considerations and the total
amount of activities available is definitely less. *In the Keys,
about the only thing you cannot do year-round are mountain climbing
and white water rafting. Boating access and controlling depth
Is there direct boating access on the property? If so, how large
a boat can you have behind the home? This is determined by what
we in the Keys call controlling draft or depth. For example:
If a boat is under 30ft in most cases 3 ft draft is OK. Draft
means...what is the lowest water depth you have to go through
to get to open or deep water. If you have a sailboat or 50 ft
boat you will need a deeper draft such as 5ft.

Now..obviously if you have a 50 ft sailboat behind your home, the canals or waterways
have to provide you with turn-around room. If the access is a deep
draft, then expect prices to go up. If there is no water access
at the home or the draft is for kayaks only, in most cases expect
a drop in price. If there is no direct water access...how far
is the nearest boat ramp or is there a boat slip available? If
so, is it included and what is the draft out of the boat slip.
So the boating issue has a very direct effect on pricing here.

Neighborhoods with bigger canals and deep draft boating are generally
home to the Million dollar and plus homes. Nearby Medical and
shopping options These are very important considerations. If
there is an accident, how far away is a hospital? In the Upper
Keys, we have Baptist hospitals in Tavernier which is an excellent
option. If you need groceries or restaurants, what is nearby?
Oftentimes vacation properties can be secluded and don’t
offer easy access to the above. At first being, the remote can seem
as desirable, but in the end, it can grow old quickly. This also
affects home values by the way. If you can have the vacation
feel and recreation, yet have amenities nearby, the prices go
up. One thing about the upper Keys is that Miami and South Beach
are just about an hour away and World famous Key West, 2 hours.
How much room do you need?

If you own a home with nearby recreation
and sightseeing, expect people to come out of the woodwork. Everyone
will be your friend. Larger homes, with more bedrooms, a 3/2
and up always rent better. So if you can, get home with extra
space. Type of Construction or is it built to last. The age of
the home will determine the building code that it was built to.
In the Keys, newer homes have to be built to strict specs as to
wind handling characteristics. Also, look for low maintenance
homes. Lots of homes in the Keys are made of concrete block and
have pea-rock for yards and the outside is stucco over concrete
or frame. This means lower maintenance, which is very important
for an absentee owner. Finding renters Does the home have good
rental potential and is there local rental management available?

This is a very important consideration, both for a long term and
short term vacation rentals. Remember, even if you don’t
want to rent, this can be an important consideration for a future
buyer or if your situation changes. Home maintenance. Are there
nearby electricians, plumbers, appliance stores, and general contractors.
If anything does happen, the prices to have things repaired or
replaced will be less if there are competition and service people
are nearby. Check with the REALTOR you are talking with to get
a Vendor list of who the Real Estate company uses to service
their rentals and offices. Rules and Regulations Make sure you
are clear on and have copies of any deed restrictions or condo
docs as to what is allowed and what is not. Too many rules can
be appetizing for some but a turnoff for future buyers.

For example, if you have children who will want to use the property in the
future as a college break, lots of communities can prohibit it.
In conclusion, the upper Keys offer good investment potential
from an appreciation aspect and income potential from renters.
Regarding Appreciation. Because Miami and Ft Lauderdale are a
short drive away, people there look to the Keys as a getaway.
Think New York and the Jersey shore. We sell a majority of homes
to people from these areas. Income potential. About 50% of the
vacation renters in the Keys are from Florida. They come here
because the Keys are a completely different experience.

This means as Florida grows (it is on pace to be the 2nd largest state
in the USA by 2010) we will have more people looking to vacation
here. This will drive prices up and make rental occupancy rates
climb even more.

Overview of Short Sales and Foreclosures
The Basics of “Short Sales”
by William Bronchick

You will likely come across dozens of properties in foreclosure
with little or no equity, that is, the seller owes at close to
or more than the property is worth. In these situations, lenders
are sometimes willing to accept less than the full amount due,
commonly referred to as a "short pay" or "short sale."

Negotiating a short sale with the lender is a difficult process,
generally because it is a daunting task finding a bank officer
who has the authority to accept a discount. You will have to
call around to locate the lender’s “Loss Mitigation
Department.” More than likely, each lender you deal with
will have a separate name for this department, so be patient
when calling. Much like getting your phone bill corrected, you
can expect the process to involve a lot of waiting on hold and
being bounced around an intricate maze of automated voice mail
systems. Once you get in touch with the right person, then the
negotiating begins.

From the lender’s perspective, a short sale saves many
of the costs associated with the foreclosure process - attorney
fees, the eviction process, delays from borrower bankruptcy,
damage to the property, costs associated with resale, etc. In
a short sale scenario, the lender gets the property back faster,
so it is able to cut its losses. Your job as the investor is
to convince the lender that it will fare better by accepting
less money now.

The lender will want some information about the property, the
borrower, and the deal he has made with you. Specifically, the
lender wants to know what the property is worth. The lender will
generally hire a local real estate broker or appraiser to evaluate
the property (called a broker’s price opinion or “BPO”).
You can also submit your own appraisal or comparable sales information.
In addition, you will want to offer as much specific negative
information about the property as possible. Also, include some
relevant information about the neighborhood and the local economy
if things are bad (copies of newspaper articles with “bad
news” may help). A contract’s bid for repair estimates
should also be submitted, which, of course, should be the highest
bid you can obtain!

The lender will also ask for financial information about the
borrower. Sort of a backward loan application, the borrower
must prove that he is broke and unable to afford the payments.
The borrower must show that he has no other source of income
or assets to repay the loan. This process may involve as much
if not more paperwork than an original mortgage application!
The borrower should submit a “hardship letter”, which
is basically a sob story about how much financial trouble the
borrower is in. This may require a little literary creativity
and some help on your part. Don’t lie, just paint a picture
that doesn’t look good.

Finally, the lender generally wants to see a written contract
between you and the seller. The lender wants to make sure the
seller isn’t walking away with any cash from the deal.
Generally, the contract must be written so that the buyer pays
all costs associated with the transaction so that the “net
cash” to the seller is the exact amount of the short pay
to the lender. A preliminary HUD-1 settlement statement is often
requested, which can be difficult since many titles and escrow
companies simply won’t prepare one in advance of closing.
You can prepare your own HUD-1, and simply write “preliminary” on
the top.

Don’t be surprised if your short sale bid is rejected.
Lenders aren’t emotionally attached to their properties,
so they aren’t as likely to give you “steal.” Many
short sales fall through if the BPO comes in too high, which
is often the case. You can’t pull the wool over a lender’s
eyes - if the property isn’t in need of serious repair,
it is unlikely you can convince the lender the property is worth
a whole lot less than the appraised value.

If you are interested in these properties please contact me
and I can furnish you a list of properties

Building a home in the Keys

Buying a lot and building your dream home may be the way to
go. The cost of building will vary widely from $50.00 per square
to $300.00 and up. Basically lots in Florida as far as price
goes will run as follows. Most expensive
• Open-water—Atlantic or Gulf
• Open-water Inter-Coastal or other Rivers-Lakes
• Canal Homes with Open water views (Bay or Atlantic-Gulf)
• Canal homes-Boatable and quick access to open-water
• Dry Lots—price varies widely, based on the community
and area. *As to canal lots and how boat ability affects prices.
If the depth of the canal and the width allows for a 50ft boat
or sailboat-it will be more expensive than a lot on a canal that
is shallow and usually not as wide. The bigger the boat, the
more room needed to turn around. *Access to open water is another
the factor that influences prices. If you’re only minutes (half
hour) to good fishing-diving, expect to pay more. Also homes
on shorter canals will generally have better water quality. In
the Keys we call these swimming canals. The tides flush them
out easier and the water is clear. As of September 2005, per
an MLS search, Vacant lots-Location-Number available and starting
• Key Largo, 89 starting at $30,000
• Marathon, 446, starting at $35,000
• Key West 20, starting at $275,000 For prices on the individual
keys please contact me. The prices will vary depending on the depth
of boating etc—see information below. Permit prices and
restrictions will vary in each community. Generally the more
environmentally sensitive the area is, the more restrictions
there are in getting a permit. (Since the water is one of the
the main reason people want to be here, the state and the communities
want to keep it that way. Important: Regarding pricing. The closer
to the water and the deeper the boating,(boat draft-a 50 foot
requires deeper water and wider canals than a flats boat) the
higher the prices. Another thing to do is find out what flood
zone the property is in per FEMA maps and then talk to a local
the insurer on how that will affect your rates. Do this ahead of
time. #In all cases if you find a lot that you like, my suggestion
is that you ask for a letter of buildability from the local
zoning commission as a clause in your sales contract. Always-always,
talk with the county yourself to get an update on the laws.
So, yes, you can build here and it’s done all the time,
but make sure you ask all the necessary questions and if you
can get it in writing. See the Biz directory for builders if
that’s the way you want to go. If you want a new home contact
a residential agent. REGARDING BUILDING Ask the REALTOR that
you pick to help find you a good builder that will respond quickly.
Another consideration is to buy a lot and build later (be careful
here as building codes and laws can change due to density controls)
I would first see how long it takes to get a building permit
and then if you get one how long you can wait. In the Keys when
you get a permit there is a limit of a couple of years during which
the time you have to at least start the process (bring electric to
the site-do a septic check etc) Since all this varies widely
make sure you get all the answers, Probably best to go the the
permit department yourself and have a discussion Monroe County
permits You will probably need a building permit if you are:
• Building a new building or adding to an existing building
• Renovating an existing building
• Demolishing an existing building
• Constructing a prefabricated structure
• Moving or installing a mobile home
• Installing/Modifying other miscellaneous structures
• including fences, pools, decks, fireplaces, etc. You probably
also need a permit if you are working on your structure's:
• Electrical System
• Plumbing System
• Heating or Air Conditioning
• Ventilation Systems State and or Municipal Licenses required
• Plumbing
• Electrical
• Asbestos Abatement
• Roofing Building Departments
• 2798 Overseas Highway
• Suite 300
• Marathon, FL 33050
• 305289-2501
• fax: 305 289-2515

• 88800 Overseas Highway
• Tavernier, FL 33070
• 305852-7100
• fax: 305 852-7103

• Juvenile Justice Building
• Room 2030
• 5503 College Rd.
• Key West, FL 33040
• 305295-3990
• fax305 295-3994 Florida Building Codes
• http://www2.iccsafe.org/florida_building_code/ The purpose
of the Building Code is to protect the safety, health, and general
the welfare of the citizens through structural strength, stability,
sanitation, adequate light and ventilation, and safety to life
from hazards attributed to the built environment. This is accomplished
through the implementation of building, plumbing, mechanical
and electrical codes along with various state and local codes
and standards Information on Complaints Against Contractors:
Don't get nailed! Many citizens in Florida have fallen victim
to dishonest, unlicensed, or improperly licensed contractors.
Florida Statute 489 requires all construction contractors to
hold a valid contractor's license prior to engaging in contracting.
Always require that a contractor show you a valid contracting
license before you signs a contract. Some indications that a contractor
may be unlicensed are: the contractor requests a large deposit
or all of the money upfront before any work has commenced, the
the contractor asks you to pull a "homeowner permit", the
contractor pressures you to sign a contract "today or I
can't give you this special price." To verify licensure
of a contractor, you may call the State of Florida Dep't of Professional
Regulation at 941 338-2373 or search their contractor licensing
database. The City requires proof of licensure from contractors
who pull permits for properties located in the City, so be sure
to require that the contractor pull the permit in his name, not
your name So always play it safe and do it right. This will certainly
help you in the Insurance area also---The extra structural costs
for doing it better really pay off if a Storm hits and or you
decide to sell #The information above is based on my experience
in the Florida keys, which is highly regulated due to environmental
concerns. With regard to making any decisions, be sure to check
with local and state permit and zoning authorities and/or a Real
Estate attorney

Home inspections

What Your Home Inspection Should Cover
Siding: Look for dents or buckling

Foundations: Look for cracks or water seepage

Exterior Brick: Look for cracked bricks or mortar pulling away
from bricks

Insulation: Look for condition, adequate rating for climate
(the higher the R-value, the more effective the insulation is)

Doors and Windows: Look for loose or tight fits, condition of
locks, condition of weatherstripping

Roof: Look for age, conditions of flashing, pooling water, buckled
shingles, or lose gutters and downspouts

Ceilings, walls, and moldings. Look for loose pieces, drywall
that is pulling away.

Porch/Deck: Loose railings or step, rot

Electrical: Look for condition of fuse box/circuit breakers,
a number of outlets in each room.

Plumbing: Look for poor water pressure, banging pipes, rust
spots or corrosion that indicate leaks, sufficient insulation

Water Heater: Look for age, size adequate for the house, speed of
recovery, energy rating.

Furnace/Air Conditioning: Look for age, energy rating. Furnaces
are rated by annual fuel utilization efficiency; the higher the
rating, the lower your fuel costs. However, other factors such
as payback period and other operating costs, such as electricity
to operate motors.

Garage: Look for exterior in good repair; condition of floor—cracks,
stains, etc.; condition of door mechanism.

Basement: Look for water leakage, musty smell.

Attic: Look for adequate ventilation, water leaks from the roof.

Septic Tanks (if applicable): Adequate absorption field capacity
for the percolation rate in your area and the size of your family.

Driveways/Sidewalks: Look for cracks, heaving pavement, crumbling
near edges, stains.

www.REALTOR.org/realtormag Reprinted from REALTOR® Magazine
Online by permission of the NATIONAL ASSOCIATION OF REALTORS®.
Copyright 2003. All rights reserved

Homestead exemptions

Homestead And Other Exemptions

There are a number of exemptions outlined in state law (Florida Statute 196) that can lower your property's value and ultimately save you money in property taxes. This includes the homestead exemption which allows for a deduction of up to $50,000 off the assessed value of a property owner's primary residence. (a portion of exemption is not applicable to school taxes - see below)

Homestead Exemption

All legal Florida residents are eligible for a Homestead Exemption on their homes, condominiums, co-op apartments, and certain mobile home lots. The exemption removes $25,000 off the assessed value of an owner-occupied residence and could provide up to another $25,000 additional exemption off assessed value over $50,000. (This additional exemption does not apply to school millage.) Not only does the homestead exemption lower the value on which you pay taxes, but it also triggers the 'Save Our Homes' benefit which limits future annual increases in assessed value to 3% or less. The sale of the property, changes in ownership, or changes to the property can cause the exemption and benefit to be removed or altered. (When a home is sold, the assessed value increases to market value for the next tax roll.)

You are entitled to a Homestead Exemption if, as of January 1, you have made the property your permanent home or the permanent home of a person who is legally or naturally dependent on you. To be eligible for a homestead exemption, you must own and occupy your home as your permanent residence on January 1. The deadline to timely file for a homestead exemption is March 2, 2020. Late filing is permitted through early September. (The deadline for late filing is set by Florida law and falls on the 25th day following the mailing of the Notices of Proposed Property Taxes which occurs in mid-August.)

***File Now Online for a Homestead Exemption*** 

Manual Homestead Exemption Application
Applications and other required documentation may be hand-delivered or mailed to the Customer Service/Exemptions Division at 231 E. Forsyth Street, Suite 260, Jacksonville, Florida 32202, faxed to (904) 630-2525 or e-mailed to pacustserv@coj.net.

Required Documentation

Homestead Exemption on Mobile Homes and Additional Requirements


If you are filing for a homestead exemption and had a previous homestead in the state of Florida in either of the two tax roll years preceding the year for which you are filing, you may be eligible for Portability. Portability allows you to transfer the 'Save Our Homes' benefit from a previous homestead to a new homestead to lower your assessed value. This is not a transfer of your previous homestead exemption. You must file separate applications for homestead exemption and portability. The deadline to file timely for Portability is also March 1. Find out more on the Portability page.

Automatic Renewal

To ease the burden on taxpayers, the Property Appraiser automatically renews homestead exemptions. If there have been no changes to the property or changes in ownership or use, and the homesteaded property is still your primary residence, your Homestead Exemption will be automatically renewed each year on January 1st. In January, you will be mailed a RENEWAL CARD identifying the property and owner possessing the exemption. Keep the card as your receipt.

Other Exemptions & Informational Brochures


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Get Pre-Qualified

Get pre-qualified for a loan so you can determine the amount
of loan, you can afford.  Getting pre-qualified also increases
your chance of closing a deal, when a contract is presented a
seller is more likely to accept an already funded offer than
one from a home buyer who still needs to get a loan.   It
makes it so nice when you see a home you truly want to invest
in and you know you qualify for the loan in advance it really
adds comfort and security to your search.

Create a priority list of your needs & desires

Establishing your “criteria” early on will save
time shopping for inappropriate homes, there are many homes available
but if your priority is dockage and you require deepwater control
the depth this will establish which subdivisions are appropriate
to your need.  Please keeping mind your top reason for buying
a home should be the value you are getting, so keep in mind you
may have to sacrifice some of your amenities if an incredible
value is available.

Shop your Mortgage

There are thousands of lenders competing for your business,
create a chart that lists different types of loans, fees, etc.
you want to avoid apples to oranges contrasts by comparing fixed
rates to fixed rates not fixed to ARMS. One of the biggest decisions
to make before putting a contract on a home is how to you are
going to finance the purchase.

Get a Quality Home Inspection

It is absolutely essential to hire a qualified home inspector
when making the biggest investment of your life to assure you
peace of mind.  A qualified home inspector will provide
you with a book explaining all plumbing, electrical, air conditioning,
appliances, roofing, etc. pertaining to your new dream home.

Sign A Contract That protects You!

Make sure that the contract you put on a house allows you to
arrange to finance, leaves you enough time for your due diligence
for inspections
And spells out who pays what at the time of closing.