I’ve talked to 5 or 6 vacation rental company owners that are my friends. They are all pretty open with me as we don’t manage rentals and compete with them in the management business. Vacation rental numbers have been on a similar pattern as sales prices in recent years and rates have gone up significantly in the last few years. 2021 and 2022 were banner years for vacation rental homes in our area. None of these companies are trying for higher rates in 2023. For the most part, they told me they are trying to maintain the rates achieved last year. Multiple owners have told me that Spring is down with less demand than last year. Summer looks good for them and they think most homes will perform close to where they did in in 2022. Lots of vacation home owners obviously want each year to be better than the last. I’ve got some owners that have seen gains each year for the last 10 years in a row. 2023 won’t be another year of everything going higher and higher, but it should come very close to tying the records set in 2022. More than one manager said they’ve had to make some reductions, and renters are more cautious with their spending this year. There’s also more competition for renters with more homes getting built, and people buying homes that were primary residences and making them rentals. I was told there are approximately 20% more homes on the vacation rental market this year compared to last. It seems the nicer the rental home, and the more amenities it has to offer, the better it does.
Along with the market, overall things are positive with the local economy. There are more and more shops and restaurants opening in Port St. Joe, and the very nice new marina is a great asset for the area. Commercial property remains limited in Mexico Beach, but the owners of the iconic “Toucan’s” beachfront restaurant that was destroyed in Michael have received a building permit and hope to start construction later this summer. Tyndall Air Force base that’s being called the base of the future is in about the middle of their 5-7 year rebuild. The 200 apartments on the west end of Mexico Beach built by The St. Joe Company with Tyndall's growth in mine are set top open soon. Residential construction remains wide open on Cape San Blas and Mexico Beach along with DR Horton in WindMark.
With the area packed with vacationers through the summer, I expect the market to be solid through at least July. I'm not saying it will go down after that, but there are so many buyers planning to look this Summer it seems impossible to go down in Summer. Interest rates for a 30 year mortgage are around 6.4% right now, down from over 7%. It would certainly help the market if rates start going back down and the national economy and stock market are doing well.
Michelle and I are having lots of fun with Ollie at 2 and Hudson at 5. I'm helping coach the 98 Real Estate T-ball team and life is good. | 
No comments:
Post a Comment