The Cost to Retire in Florida is EXPLODING - Here's Why

in this video we discuss why the cost to retire to Florida has gone through the roof and some strategies you can use to deal with it coming up next on holy Schmidt we all have a vision of where we want to live both today in the future and in retirement for some of us it means that we live right here because this is where the home is for others it means moving to a place like Florida or Arizona or where the kids are if you are in retirement and you want to follow your kids but moving to Florida is an option that is quickly disappearing because the cost to move to Florida has gone up dramatically historically Florida has had the option for many people in fact most people of all income levels there was a place to live that's now changed particularly housing when it comes to Florida and the state is now pricing itself more in line with some of the more expensive States in this country for me by the way Florida is the obvious retirement choice I have family down in Florida I do business a lot of business down in Florida I'm down there quite frequently and I just like going to Florida for vacation in short I know Florida well and there are six things in that state that appeal to just about everyone the first is of course the weather in Florida the weather rarely gets below 50 degrees and because of that people tend to go there when they don't like the cold conversely people that don't like the cold don't necessarily mind the Heat and frankly it does get hot in Florida sometimes in excess of 90 degrees but for those that can't stand the cold they probably are okay with the warmth next state income taxes are zero if you come from a state that does tax rate income this can be huge it's like winning the lottery for some people for example if you're coming from New York New York has a state income tax up to 10 percent if you live in New York City that's an additional three to four percent so if you are a high income earner living in New York City you're paying 13 to 14 of your income to the state or the municipality Florida gathers all of its income from sales tax which runs at approximately 7.02 percent on average and property tax which runs at point eight percent of the value of the home and for reference most property taxes the average property tax in the United States is 0.99 of the value of the home and the communities are quite diverse from Ultra trendy South Beach to ultra affluent Boca Raton and Naples there are places you can go that cater to just about everyone in this state importantly if you move to Florida people want to visit you It's not a state where you go and people come see you every 10 years my guess is you have the same people showing up once a year once every few years anyway at a minimum that's the type of state Florida is everybody wants to be there there's a lot to do in Florida if you're a golfer there are over 1100 golf courses with 46 million rounds of golf played every year in the state over a million boats and the largest number of marinas on the east coast and let's not forget about the restaurants walking trails fitness centers Disney Epcot and a variety of other places to go living in the state and finally it's a serious business state for those that aren't ready to leave the game or at least not ready to leave the game completely the best part about Florida is that until recently it was quite reasonable in terms of cost to live there Florida up until about three or four years ago ran about 80 percent of the national average that's a great number by the way Hawaii on the top end is it 1.75 times the national average 175 percent of the national average so if you want to retire on the beach you probably don't want to live in Hawaii Florida even now is a better choice financially but there's a problem and that is the cost of living that 80 percent has gone up specifically around housing the reason is because there's been a surge of people moving to Florida as of late and there's a shortage of housing at least there was a shortage of Housing and that has caused housing prices to go up dramatically for example if you live in Miami you would have noted that if you're renting anyway your housing costs have gone up 55 percent on average between 2021 and 2022. I released a video a few weeks ago called retirees spent 80 percent of their income in these five areas and the number one category was housing that comprised 36 percent of the average return Irish spending the category of housing is comprised of your rent your mortgage your taxes your utilities and your upkeep and as the biggest spending category for those in retirement and frankly those who aren't in retirement in most cases when the cost of housing goes up You Feel It by the way I'll put a link in the description for those that are interested in that video so what's caused the surge in Florida home prices well first there's been a massive influx of new residents into the state over the last three years and with that surge comes increasing house prices and increasing rent prices by the way stick around to them because I'll give you my opinion on when price increases will stop in Florida and perhaps even go backwards let's discuss the exact details so you're better armed when it comes to making decisions the state is home to three cities in the Sun Belt that had the largest increases in prices in the country the first is Miami which had a 55 percent increase in rents between 2021 and 2022. next it was Orlando which had a 34 increase and in 1843 dollar median rental cost and then there's Tampa which had a 32 percent increase to 2098 in 2022 on average if you're buying in Florida the average cost was 407 000 that was up 15 percent from the previous year if you were buying a condo the average cost was 305 000 up 20 from the previous year however there are signs that inventory is increasing we'll discuss this at the end Florida is one of the top five migration states in the country with 55 percent of movement traffic coming into the state and 45 percent leaving the state this means that for every 100 moves involving the State of Florida 55 were into the state and 45 were out of the state putting actual numbers to it Florida had the largest number of people migrating to the state coming in at 318 000. by the way number two was Texas coming in at 231 000 and North Carolina came in number three at plus one hundred thousand on the flip side California had the largest number of net losses with 343 000 people leaving the state New York was number two with 300 000 people leaving the state and Illinois was number three with 142 people leaving the state all this data comes from the National Association of Realtors by the way so it is quite accurate of course housing costs aren't the only cost to go up in Florida when the country is running at about six percent inflation other costs are going up as well but in Florida and any popular state when there's inflation there's generally more inflation in the state that is popular so which costs go up anything that requires people at least it seems so in this day and age with a shortage of Labor think about things like restaurants Medical Services Etc now what can you do about all this first note that Florida had the perfect storm when it came to house price increases we were in the middle of a pandemic where people were not only not going into the office they were told they can't go into the office so they were forced to work from home for months even years on end well if you're forced to work from home and home can be anywhere that Zoom is Florida is a great place to go second the state's general aversion to lockdowns attracted a lot large number of people that didn't want to live in a state that required lockdowns and finally the cost of building materials were going way up because there was a shortage of labor now the lockdown restrictions are gone people are no longer told they have to work from home in fact many employers are now requiring employees to come back into the office at least one two or three days a week if not more and the cost to build a house has come down because people are back on the line making things like wall board and lumber this means the exit is based on lockdowns and working from home is stopped and we're looking at more normal migration patterns in 2023 and Beyond and with it is a normalization of housing prices maybe even a reduction or decline in housing prices because of the availability of land and corresponding Building Material if you're watching this video from Florida please let the viewers of this video know what your thoughts are on the rising prices there just put your comments in the com comment section below also if you like this video please help me help others find this video by giving it a thumbs up the YouTube algorithm uses the number of thumbs up as it's triggered to push a video up higher in the search results and I won't help as many people as possible finally if you like this video I've picked another video for you it's right there it's called why Panama is the best place in the world to retire this is Jeff Schmidt thanks for watching

Channel: Holy Schmidt!

Views: 93,375

Keywords: retire in florida, retire in florida, cheapest places to retire in florida, places to retire in florida, best towns to retire in florida, retire in tampa florida, retire in orlando florida, cost to retire in florida

Id: zIV5KYqqpnI

Length: 9min 9sec (549 seconds)

Published: Sun Apr 16 2023