“Location, location, location.”
The old adage historically has summed up the three factors that matter most in real estate.
But, in 2013, there’s a new buzzword that sums up what is increasingly important to buyers of the future — one that is so important that it, too, bears repeating three times:
“Lifestyle, lifestyle, lifestyle.”
On Nov. 17, the Longboat Key Revitalization Task Force made a presentation to the Federation of Longboat Key Condominiums titled “Real Estate Trends & Their Impacts on Longboat Key.”
It included an imaginary real-estate advertisement dated Jan. 2, 2020:
“Cozy condo on Longboat Key! 2/2 1,200 square feet with screened lanai. The complex is only 50 years old. Maintenance fees, insurance taxes & beach renourishment fees average — $3,300 monthly.
Price — Make an offer!”
At the top of the slides were the words:
“We all want to avoid this scenario.”
The condo advertisement featured all the things that the buyers of 2013 and beyond don’t want.
They want open outdoor space, with features such as balconies, verandas and terraces, along with high-end features, such as a mini-gym and chef’s kitchen.
They want new construction — a rarity on the almost entirely built-out island of Longboat Key, where, according to data compiled by Task Force member Lenny Landau, 58% of condominiums were built in or after 1979.
They’re more aware of the overall costs of homeownership, including maintenance, insurance and association fees.
And they value lifestyle as much, if not more, than location.
The good news, heading into 2013, is that buyers are seeking out the Longboat Key lifestyle. And with most distressed inventory gone, buyers on the island aren’t just bargain-hunters.
“They’re looking for the lifestyle of the community first,” said Roger Pettingell, broker associate at Coldwell Banker Residential Real Estate. “They often have already decided on the community, and many are looking on the waterfront … They’re looking for values now, not steals.”
They’re no longer looking for the biggest house on the block.
“The McMansion craze changed after Lehman fell,” Pettingell said. “There also seemed to be the concept where people expected to get something in Florida that would be big enough for their whole family to gather. But everybody’s so busy these days that people have difficulty getting everybody together at once.”
“Although there will always be flamboyance, I think real-estate bling is pretty much out,” said Cheryl Loeffler, sales associate with Premier Sotheby’s International Realty. “Demand has shifted; taste, aesthetics and artisanship are more important factors.”
But the Key’s restrictive Comprehensive Plan and codes have made rebuilding properties difficult during the past three decades, creating a challenge that will extend far beyond 2013.
The Task Force presentation urged owners to start considering questions now, such as the age and amenities of properties, how they will compare to new condominium properties in competing markets and whether the condo investment is an effective hedge against inflation — to avoid the nightmare 2020 scenario.
Lifestyle amenities — such as open living space, high-end fixtures and the ability to walk, bike or kayak to work — will be especially important to millennials, the generation generally defined as those born after the early 1980s that will become the buyers of the future.
And, although millennials aren’t likely to take over anytime soon on Longboat Key, where the average age was 70.4 at the time of the 2010 U.S. Census, buyers are already looking for the features that will become more important to the younger generation.
Quality is especially important on Longboat Key, where new construction and vacant land are rarities.
“There’s not a lot of new construction to offer, but they’re keen on properties that are recently renovated,” said Richard Perlman, sales associate with Michael Saunders & Co., who cites Longboat Key Towers, which underwent a $12 million upgrade in 2008, as an example of a property that increased demand by renovating.
Buyers are looking for ease above all.
Many want turnkey properties, with some seeking furnished homes, as well.
In 2013, most local Realtors aren’t expecting drastic changes to Key real estate, barring an unforeseen disaster such as red tide or an oil spill. The first 11 months of 2012 were fairly similar to the same period the year prior, in terms of prices and the number of sales. (See box.) Realtors expect the uptick to continue, with the reduced inventory pushing prices upward, albeit modestly.
When sales data is compiled in early 2013 for December 2012, it will most likely show a bump in sales, as many sellers rushed to close transactions before the end of the year because of uncertainty in the economy and the likelihood of an increase in capital gains taxes.
Some sellers have even offered their Realtors bonuses for closing out their sale by year’s end, according to Perlman.
The Key will get a small dose of new construction in the next two-and-a-half years:
Construction began in November on the first two homes in the planned 13-home, mid-Key Triton Bend subdivision.
“There has not been a new development on Longboat in eight or nine years,” Walter Hackett, of Michael Saunders & Co., told the Longboat Observer in November. Hackett is the developing agent for the project and is co-listing it with Barbara Najmy, also of Michael Saunders & Co.
That project was put “on the back burner” because of the recession nearly five years ago, according to Hackett, but is now considered a “front-burner” project because of encouraging signs in the local real-estate market.
The future of another vacant property that could eventually result in new construction remains unclear:
The owner of the site at 4765 Gulf of Mexico Drive has until December 2013 to obtain building permits for the proposed 11-unit luxury Bleu Claire condominium.
Another trend that’s sure to continue in 2013 and beyond:
Buyers are savvier than ever and conducting their own research before visiting property.
That means future buyers, especially who aren’t familiar with the area, are likely checking out other waterfront communities in addition to Longboat Key.
“I think the days are pretty numbered of people coming to Sarasota and not considering other Gulf properties,” Loeffler said.
Realtors expect an influx of Canadian buyers that they saw in 2011 and 2012 to continue, as many seek to take advantage of their country’s relatively strong economy and purchase vacation homes in Florida, where prices are beginning to appreciate.
The Sarasota-Bradenton-Venice area is the top Florida destination for Canadian buyers, accounting for 14.4% of all purchases from our neighbors to the north, according to the August 2012 Florida Realtors report “Profile of International Home Buyers in Florida,” which covered the period from July 2011 to June 2012.
The same report found that 31% of foreign buyers in Florida were Canadian.