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Why is Real Estate Investing in Jacksonville, FL, So Popular, Right Now

Jacksonville FL, has one of the hottest real estate markets in the nation. Discover the key reasons real estate investors love this Florida city.

last updated Friday, January 5, 2024
#Invest in Florida property #real estate investor Florida Invest in Florida property



John Burson     Subscribe
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When most people look to invest in Florida property, they usually focus on the state's more popular destinations like Tampa or Orlando. But they eventually include Jacksonville because real estate investing in Jacksonville, FL, offers equally attractive features. This northeastern Florida city is attracting more attention for many compelling reasons, including its diverse economy and housing affordability.

Before you become a real estate investor in Florida property, you should look at what investment property for sale Jacksonville FL, has to offer. This article will give you an in-depth perspective of real estate investing in Jacksonville, FL.

The State of Real Estate Investing in Jacksonville, FL

With more than 1.2 million residents, Jacksonville has the largest landmass in the U.S. and extends across seven counties. This city ranks number six on the Zillow.com list of the "10 Hottest Housing Markets because of its 270 days of sunshine per year, 22 miles of white sandy shores, numerous beaches, and 1,100 miles of navigable waters.

In addition, thanks to its business-friendly environment, Jacksonville has become popular among investors, especially in the healthcare and bioscience sectors. These amenities have helped Jacksonville to consistently rank high as one of the best cities for real estate investors in Florida.

Although Jacksonville is not as popular as Miami or Orlando, you can take advantage of this destination by pursuing ground-floor opportunities like build to rent Florida property or house-flipping projects. On top of that, this city has several positive incentives for considering investment property for sale in Jacksonville, FL, including:

  • 25% more property value appreciation: It may surprise you that Jacksonville home prices have had an average annual increase of 4.6% since 1982. This gain outperforms other major real estate markets like Kansas, Dallas, Memphis, Cleveland, and Birmingham by about 25%.
  • Ranked among the fastest-growing Florida neighborhoods: To gain maximum risk-adjusted returns, you should invest in affordable communities in moderately priced real estate markets. A real estate investor Florida has an advantage in this category because this state has led the U.S. in home price appreciation over the past ten years. So, when you factor in affordable purchase prices and tax benefits, Jacksonville has excellent potential as a profitable real estate investment.

Some of the best neighborhoods to invest in Jacksonville FL, are Oceanway, East Arlington, Chimney Lakes, Beach Haven, Riverside, Baymeadows, and Secret Cove. But there are more Jacksonville communities worth investigating.

Why Are Jacksonville Single-Family Homes in High Demand?

Never in Jacksonville's history has the demand for single-family homes been so high. And shrinking inventory has caused real estate prices to rise even more. However, this pro-seller market condition contributes to a significant increase in single-family construction permits. As a result, single-family homes comprise more than half of the home construction in the Jacksonville area. The median price for a Tampa home is $380,000, with a median of 48 days on the market.

Even though single-family homes are in low supply in Jacksonville, the median home prices are far below the national average. So, single-family houses are still affordable for potential homebuyers and people looking for investment property for sale Jacksonville FL.

What Are the Prospects for Investing in the Jacksonville Rental Market?

Jacksonville consistently ranks as one of the best U.S. cities to buy a rental property. With proper due diligence, investing in the Jacksonville rental market could bring you positive cash flow and long-term equity growth.

From 2020 to 2021, the average monthly rent in Jacksonville increased 16% from $1,029 to $1,195. And the rental occupancy also rose by 1%. Currently, the percentage of renters in Jacksonville is 6% higher than the national average of 38%. As of March 2023, the median rent for all bedrooms in Jacksonville is $1705.

Motivating Factors Behind the Mounting Interest in Real Estate Investing in Jacksonville, FL

The enthusiastic nationwide interest in investment property for sale in Jacksonville, FL, stems from several powerful developments in the city. Here are the three primary factors.

  1. Jacksonville's Robust Economy
    Ranked 25th among the fastest-growing cities in the country, Jacksonville has acquired about 60,000 more residents over the last five years. Fueling this growth spurt is a mass of planned projects for residential buildings, restaurants, and retail space in Jacksonville's downtown location. In addition, local developer Steve Atkin has plans to launch a $1.1 billion redevelopment project on primarily city property.
    As part of the plan, a portion of the 2.3 million square feet of programmable space will result from $559 million in private funding. The Jacksonville Jaguars are also breaking ground on a multi-faceted complex that will include a Four Seasons Hotel, an orthopedic sports medicine complex, and office space. Other key drivers of Jacksonville's economic growth are the following:
    • Famous companies like Stein Mart, CSX Transportation, and Firehouse Subs call Jacksonville home.
    • Dun & Bradstreet of New Jersey plans to move its global headquarters to Jacksonville.
    • Jacksonville ranks as one of Forbes' top U.S. cities for job growth.
    • The city's unemployment rate is around 4%, two percentage points below the national average.
  2. Growing Population
    Experts estimate that Jacksonville will welcome 800,000 new residents. They also predict a 14% increase in job opportunities over the same period. If this happens, job growth will double the projected national job growth rate.
  3. Increased Housing Construction Plans
    In 2022, single-family permits for new construction homes in Jacksonville rose by 35%, and multifamily permits spiked by 234%. Altogether, the overall housing permits for Jacksonville increased 63%, year-over-year. This rise in construction permits represents the most significant increase in any central metro area in Florida.

Potential Troubles and Disadvantages Associate with Real Estate Investing in Jacksonville, Fl.

When investing in any property, you should be aware of the possible problems that can come your way. Jacksonville is no exception. So, you should consider the following potential issues when considering investment property for sale in Jacksonville, FL.

  • Water supply problems
    Due to climate change, maintaining the water supply for a growing city and business population may become a severe problem for Jacksonville. So, it pays to keep current with the city's efforts to avoid water shortages.
  • Wildfires and tornados
    Before you become a real estate investor Florida, ensure your insurance has sufficient coverage for natural disasters like wildfires and tornados.
  • Jacksonville is not a great tourist destination.
    If you're looking for a promising Airbnb investment, Jacksonville is probably not your place. This city doesn't attract tourists like Orlando and Tampa Bay.
  • Relatively low-income level
    On average, Jacksonville dwellers have a lower income level than citizens in other major Florida metros, which may be a factor in future rent increases.

Should You Buy Investment Property for Sale in Jacksonville, FL?

We've provided compelling evidence of why Zillow.com selected Jacksonville as the sixth hottest housing market in the country. This city offers excellent investment opportunities for investing in single-family rentals, flipping opportunities, home equity appreciation, and ground-up construction.

However, it would be best to consider Jacksonville real estate more affordable than other major Florida cities because it is not the most popular city for visitors or people relocating from other regions. And chances are, it will never be. So your choice will depend on your unique requirements and possibly with the help of a professional familiar with real estate investing in Jacksonville FL.

Q&A

What group of people would be most attracted to investment property for sale in Jacksonville, FL?

Since Jacksonville has more affordable housing than Miami and Tampa, first-time real estate investors and homebuyers are most likely interested in investment property for sale in Jacksonville.

Is Jacksonville, FL, crowded?

Jacksonville is the largest city by area in the United States. But its growing population is just over 900,000 people, equating to 1,200 people per square mile. Therefore, Jacksonville is less crowded than other big cities like New York or Los Angeles.

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