The Bees Keys

Posted on: 23 November 2010 by Rhian Mainwaring

Shrewd second-homers in search of a waterfront bargain Stateside are homing in on the cut-price archipelago of The Florida Keys, says Laura Henderson.

mariners resortAmerican writer and journalist Ernest Hemingway first encountered the raffish attractions of the Florida Keys in the 1930's on a whirlwind visit en route to his pied a terre retreat in Paris. Smitten by the islands’ bohemian charms, he upped sticks to the mariners’ outpost of Key West – a move, which afforded him the opportunity to sail the inky-blue Gulf Stream waters on his boat, Pilar, and enjoy the fishing; a sport he loved so much. These days, the cult of Hemingway lives on in the town; his pristine former home-turned-museum, now an architectural template for the vintage style of much of the town’s real estate: pretty pastel coloured wooden framed cottages peeping out from behind picket fence gardens brimming with bougainvillea, oleander and jacaranda.

Joined to the rest of civilisation by nothing more than the narrow umbilical US1 “Dixie” Highway, the bohemian attractions of America’s southernmost island chain is a world apart from the Art Deco bling and buzz of Miami, just a two hour drive away.

Most of the area falls within the boundaries of the state’s national parks, with an abundance of mangrove wetlands, deer-laden pine forests and living coral reefs. The region’s other key draw, however, is its strict handle on real estate development, with fewer than 300 residential building licences granted each year.

While the area has historically been one of the most expensive places to buy in Florida, previous stratospheric house prices have taken a battering of late, down by an average of 30% - 40% on pre-recession highs, although as local agent John McLoughlin stresses, national forecasts predict a quicker recovery here than other Florida hotspots because “there’s rarity value in the land.” It’s a viewpoint shared by local agent Keys Caribbean MD, Sam Schorr: “Unlike parts of Miami, Naples and Orlando prices in the Keys have never been driven by speculators. Even at the peak of the boom, most people were buying here with a long-term view, either to relocate on a full-time basis, or as a legacy investment, a holiday bolthole that could be passed down the generations.”

One of 600 or so full-time British residents scattered across the archipelago, Leicestershire-born retiree Craig Hunt has watched changing market dynamics unfold with interest in recent months. Having spent £1,000,000 for a freehold plot and house construction in 2002, eight years on, he and his wife Mariella are the proud owners of a stunning 4-bedroom villa, with an estimated value of £2.5m, on Sunset Key, a private island of 70 homes just a three-minute ferry ride from Key West.

mariners marina“Our first impression of the Keys was like stumbling on a hidden Florida,” explains the former president of the Holiday Inn hotel chain. “I’ve spent the best part of thirty years travelling with work, so life here is the perfect antidote: a laid-back Caribbean atmosphere but with the security and sophistication of Main St USA. The strict environmental integrity and beauty of the area is a one off. The climate, (average temperatures top 80 degrees) and outdoor lifestyle are also hard to beat, but the overriding draw is perhaps the community atmosphere built around the many boating, fishing and diving pursuits. Everyone from the resident millionaire to the neighbour who runs the local diner just mixes in. It doesn’t take long to feel at home.”

It’s a quality of life however, that comes at a price: 1992 saw Hurricane Andrew whistle through the county reaping destruction, one of several “natural hazards” that Hunt has learned to take in his stride: “Tropical storms are a fact of life in these parts – the key is to be prepared – have comprehensive insurance and of course be selective in your choice of property. New build homes are now built to such rigorous hurricane standards in any case – you can’t do more than that. People here are resilient. It’s what gives the place personality.”

While most soon-to-be-retirees plump for the vintage Queen Anne and Colonial style real estate offerings in downtown Key West, 90 miles north it’s a different demographic altogether in the diving Mecca of Key Largo, where younger buyers are stepping on the new build ladder.

“Entry-level prices start from as little as £200,000 for a luxury two-bed apartment,” confirms Veepka Westedt from Century 21 Real Estate, “plus you’re only an hour’s drive from Miami. Richard Madeley and Judy Finnigan bought their luxury condo here,” she adds. “Like many long-haulers, they wanted a maintenance-light option. Not only that, you’re buying into a ready-made community with on-site extras from deepwater boat slips, swimming pools and tennis courts, to off-road parking. Most developments also have a managed rental pool, which, with the year-round season we have, is a perk worth having.”        

Florida Keys Buyer’s Guide

Buyers need to enlist the services of a fully licensed buyers agent to handle the purchase on their behalf.

Once a formal offer is accepted, a deposit of 10% to 30% is payable into an escrow account. A title insurance company then vets public records and insures the property against any third party claims. On completion, the balance of the purchase price is paid – usually within 30 days of the offer being accepted. 

Annual property taxes amount to roughly one-and-a-half per cent of the property’s assessed value.

The islands’ captive holiday market provides year round rental opportunities, although Monroe County restrict the number of short-term lets, so it’s important to check if the property has rental restrictions.

Home insurance premiums vary according to location with waterfront real estate appreciably more. Separate hurricane, flood, and third party liability cover are also required.

By Laura Henderson

Property journalist, columnist and author

Laura is a UK-based property journalist and author specialising in domestic and overseas markets. A regular contributor to the Financial Times, Sunday Express, Daily Telegraph and Homes Overseas magazine, she also edits a monthly property column for the Scotsman newspaper and is the author of several on-line investor guides for among others, Channel 4 Homes.

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