General Views on the Jax Market

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General Views on the Jax Market

Philip Katz
Tampa, FL · Member since 2019 · 1 post · 0 votes

Hi,

I’m 24 looking to move to FL in a market that fits the following: high appreciation, lots of young professionals, hot weather, possible to househack and breakeven or come close to it, and build a portfolio househacking annually, as well as buying buy and hold rentals or BRRRing.

I think any of these could fit the bill, but am leaning towards Jax.

One thing that’s attractive about Jacksonville is that the job market seems to be strong/well-diversified for tenants, and you have anything in the area from cheap to expensive so options for owning rental properties are strong. I will be working remote.

From an investment perspective: Jacksonville feels earlier in the cycle than places like Tampa or Orlando and on fewer investors’ minds (though it’s no secret).

I'd be looking to househack whether that's living in an ADU and renting out the main home, or buying small multifam or even doing enough rehab on a single-family home to create separate units.

It seems possible to find a decent small multifam you can breakeven on househacking for $400-600k in Riverside/Avondale. I’m thinking Riverside/Avondale has more room to appreciate than Jacksonville Beach and likely draws a younger crowd? Seems like Jax Beach has run its course in appreciation at least in the nicer areas, and might be harder to find tenants to cover the cost?

I’m also wondering what insurance pricing looks like given storm risk, though I know Jax has escaped hurricanes for the most part.

Apologies for all the questions, but curious what thoughts BP might have on the market generally (and where we go as COVID continues) and on the move to Jax. Thank you!

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Jack Bobeck
Rental Property Investor · Jacksonville, FL · Member since 2008 · 784 posts · 528 votes
5y

Insurance is going crazy, we have seen our prices for properties double this year. Its not a normal year, get quotes from your agent to get an idea. Per my agent, many companies have pulled out of florida and some from Duval County (Jacksonville). I was paying $600 for a 1000 sq ft home in Murray Hill, now its up to $1200. They all now want a 4-point inspection too. So you may have to go the TAPCO route for a while until you can get the house up to fixed status. 

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  • Christian Dennis
    Jacksonville Beach, FL · Member since 2016 · 12 posts · 4 votes
    5y

    Philip,


    I agree house hacking in Avondale/Riverside may make more sense. With all the development plans in the works downtown, I do think you have a better chance of hitting an appreciation homerun downtown opposed to the beaches. However, the appreciation in Jax Beach has a long way to go. As downtown appreciates, so will the beaches. There will always be a demand to live by the ocean IMO. I don’t think you can miss either way. Be careful of age of the house

    1Reply
  • Christian Dennis
    Jacksonville Beach, FL · Member since 2016 · 12 posts · 4 votes
    5y

    When purchasing downtown. Insurance is around 800-1200 at beaches depending on size of home. 

    1Reply
  • Jack Bobeck
    Rental Property Investor · Jacksonville, FL · Member since 2008 · 784 posts · 528 votes
    5y

    Insurance is going crazy, we have seen our prices for properties double this year. Its not a normal year, get quotes from your agent to get an idea. Per my agent, many companies have pulled out of florida and some from Duval County (Jacksonville). I was paying $600 for a 1000 sq ft home in Murray Hill, now its up to $1200. They all now want a 4-point inspection too. So you may have to go the TAPCO route for a while until you can get the house up to fixed status. 

    3Reply
  • Brett Nissen
    Real Estate Agent · Jacksonville, FL · Member since 2016 · 35 posts · 26 votes
    5y

    Love that you are looking at Jax! I am a local agent and former house hacker. I house hacked a duplex in Avondale, but now live out at the beaches. Jax is no secret to investors or individuals moving here to live FT/PT. Jax was the #1 city in the country for net arrivals since April of this year, and has been a top 5-10 fastest growing city in the US for quite some time. The beaches vs Riverside/Avondale is a decision a lot of my house hacker clients face. I will say that the returns generally are a lot better in the historic areas like Riverside, Avondale, and San Marco. When I house hacked in Avondale, I got my monthly payment to about $100/mo. 

    1Reply
  • Brett Nissen
    Real Estate Agent · Jacksonville, FL · Member since 2016 · 35 posts · 26 votes
    5y

    Also both Riverside/Avondale and the beaches have a large young professional population to be your potential tenant base. Both are also near Navy bases (Mayport and NAS), and both are near major local hospitals.

    1Reply
  • Dylan Lein
    Contractor · Jacksonville, FL · Member since 2019 · 4 posts · 1 vote
    5y

    Hey Philip, 

    What area are you thinking of moving from? I think its pretty tough to go wrong in Jacksonville. It's great for all the reasons you mentioned: warm weather, the beach, an emerging downtown with young professionals, large area, diversity, and a thriving economy.

    I was born and raised there and recently moved to Asheville for work. I did exactly what you are talking about in buying a duplex in Riverside, house hacking/rehabbing, and then renting it out to tenants. I'm actually listing it this week right in that range your speaking of. I've also bought in Atlantic Beach and over the bridge closer to the college at UNF so let me know if you need any advise on areas in the city. 

    I think the biggest hurdle is the pure lack in quantity of multifamily homes in the area but downtown and the beaches have tons of opportunity for homes to be rehabbed. As far as insurance, Jax is situated in a way that most hurricanes miss us and there are just a few areas that lie within the flood plain warranting higher insurance. 

    Feel free to reach out with any questions and best of luck to you!

    1Reply
  • Mark Fries
    Contractor · Jacksonville, FL · Member since 2017 · 1k+ posts · 2k+ votes
    5y

    @Jack Bobeck

    I am so tired of insurance companies gouging me on my rentals... Just like you, my policies have doubled. I'm honestly thinking about just canceling my policies and rolling the dice.... If I could get enough investors on board we could start our own captive policy and do our own insurance.

    1Reply
  • Jack Bobeck
    Rental Property Investor · Jacksonville, FL · Member since 2008 · 784 posts · 528 votes
    5y

    @Mark Fries I agree with you. This is complete and total horse manure. It happens every few years, with or without storms, then the industry settles back down again. Insurance is another expense that forces Buy and Hold into looking at their expenses and see if its worth it to buy and hold. We all just need to make enough to where we can self-insure. 

    0Reply
  • Mark Fries
    Contractor · Jacksonville, FL · Member since 2017 · 1k+ posts · 2k+ votes
    5y

    @Jack Bobeck

    Why couldn't me and you and a few other people just get together, start an LLC, pay dues into account and if one of the participants in our group files a claim, we pay it out of the pool?

    Would definitely save us tons and tons of money and also prevent anybody from wanting to actually file a claim unless it was absolutely needed?

    Like a self funded insurance policy?

    0Reply
  • Patrick Strycharz
    Investor · Jacksonville, FL · Member since 2020 · 11 posts · 10 votes
    5y

    Here is why premiums keep going up!

    https://www.floridatoday.com/s...

    0Reply
  • Jared Matson
    Jacksonville, FL · Member since 2014 · 9 posts · 1 vote
    5y
    Originally posted by @Philip Katz:

    Apologies for all the questions, but curious what thoughts BP might have on the market generally (and where we go as COVID continues) and on the move to Jax. Thank you!

    Philip, welcome to Jax. I have lived here on and off from 2009, 2013, and now I am back. I messed up and didn't by at Jax Beach in 2010. There was a duplex that I could have house hacked but I let other people influenced me and moved into a nice but older neighborhood with minimal value add. Amazing how things change when you educate yourself. 

    I will say that while there has been a lot of positives within the Jax area there are simply too many speculators and wholesale flippers that looking to get their cut. Springfield is a perfect example of this where homes are being priced to rival Avondale, San Marco, and Riverside properties when the area doesn't support it. 

    My friends within the courts are saying that there will be a flood of foreclosures coming down the pipeline. He mentioned many of them are landlords that did the BRRR method and are finding themselves in forbearance with higher payments to cover the missed payments. He did note that there will be values to be had but overall the RE market will cool in Jax and will be good for investing.


    0Reply
  • Travis M.
    Member since 2020 · 37 posts · 32 votes
    5y
    Originally posted by @Patrick Strycharz:

    Here is why premiums keep going up!

    https://www.floridatoday.com/s...

    Too true!

    0Reply
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