Is Florida Real Estate – Any Real Estate – a Buy?

Real estate has always been my favorite investment category. That’s primarily because the long-term trend has always been up. But it’s also because, at base, real estate is not complicated. And if you do the kind of real estate investing I do (rental properties), it is reasonably easy to avoid stupid mistakes.

Recently, there has been a surge in property values across America, and especially in states like Florida and Texas. In fact, from the first quarter of 2021 to the first quarter of 2023, the appreciation rate in Florida stood at an impressive 44.36%. This growth far exceeded the national average (by 20.15%).

But unlike a steady two-year climb in other assets, this two-year-plus rise in real estate values doesn’t tempt me to buy more. That’s primarily because, unlike stocks and bonds and many other asset classes, real estate investing – the way I do it – is relatively straightforward. You don’t need to understand 100-line-item balance sheets or 40-page P&Ls to understand what a particular piece of property is worth. Nor what sort of income you can expect from it. That information, which is super-important, can be easily researched by looking at public records or speaking to local brokers. As for the value trends and price fluctuations, if you put your money in rentals, and follow a few very simple rules, you don’t have to worry about being caught with a highly overvalued piece of property. The ROI questions you will have will not be if and when profits will go up but simply by how much.