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How to make lucrative real estate investments in Venice, FL

How to make lucrative real estate investments in Venice, FL

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Located in Southwest Florida, Venice stretches south of Sarasota along the white-sand Gulf Coast. It encompasses 14 miles of beaches, from Casey Key to Manasota Key. A tropical paradise, this city is among the most enticing places for those looking to invest in real estate.

Interested in effective real estate strategies for Venice, Florida real estate? Read on.

UNDERSTANDING THE VENICE, FLORIDA REAL ESTATE MARKET

arrow up on the building

The Venice real estate market presents various lucrative opportunities for the savvy investor.

  1. Investing in real estate in Venice, FL is a smart move for building long-term equity. Home appreciation in Venice, FL ranks among the top 10% in the whole United States. In the past 10 years, homes in the area have appreciated by over 150%, at an annual rate of 9.77%. And since 2000, their market value has grown by 240%, at an average annual rate of 5.35%.
  2. Waterfront property in Venice, FL has experienced the steadiest growth.  Some of the best waterfront real estate are located in neighborhoods that have recorded the highest rates of appreciation. These include East Gate, Gulf Shores, South Venice, Bayshore Estates, and Venice Gardens.
  3. Venice, FL continues to draw in buyers because of  the way the city has transformed. From a simple homestead near a bay, Venice is now a coastal city with a distinctive small-town vibe and convenient access to world-class beaches – but without the crowds. In 2022, the city recorded a population of 27, 272 permanent residents.
  4. Venice, FL is all about location, location, location. Only 19 miles south of Sarasota and 60 miles southwest of Tampa, Venice is within easy reach. It also boasts 30 parks, 17 golf courses, 14 beaches, and a historic downtown with plenty of family-owned businesses, boutiques, cafes and restaurants, public art, a Saturday farmers market, and heritage structures. Less than a mile away, the white sands of Venice Beach yield fossilized shark teeth, which earned the city the title of “Shark Tooth Capital of the World.”
  5. Venice, FL has perks galore. The city is safe, imposes no personal income tax, and remains sunny year-round. The median household income in 2021 was higher than the state average and poverty was 6.6% compared to Florida’s 12.7% All point to business and commercial opportunities geared to serving families, tourists, and the city’s multi-ethnic community.

With all these in mind, investors like you need a foundation upon which they can base their decisions. Here are some of the most useful real estate investment strategies to enable you to make the most of your investment.

KEY REAL ESTATE INVESTMENT STRATEGIES

There are three main real estate investment strategies to consider when it comes to Venice, Florida.

  1. Investment strategies in residential real estate

    holding house key

    Venice promises lucrative rewards in residential real estate, if you make the right investment decisions.

    • Consider your optionsLEASING OR RENTING OUT a property is one of the most popular ways to make money from a property. In Venice, Florida, more than 20% of the population are renters, which means it has a promising market to explore for investors.

      FIXING AND FLIPPING involves buying a house that needs repairs or renovating to improve its market value, and then putting it back on the market once flipped. With many homes in Venice listed as pending (or sellers that have accepted an offer but are awaiting the results of inspections, appraisals, and financing prior to closing) at about 45 days, a fix-and-flip means a quicker ROI and a faster way to turn a profit on your investment.

      WHOLESALING means buying a piece of property at a lower price and then selling the rights to purchase the property to another investor for a fee. This strategy is ideal for investors with a good network and understanding of the local real estate market.

      REAL ESTATE INVESTMENT TRUSTS (REITs) are companies that own and run income-generating real estate. This provides a way to invest in real estate without directly owning properties. REITs allow Investors to earn income through dividends and possible capital gains.

      There’s more to explore when it comes to investing in residential real estate. Dig deeper and learn as much as you can to expand your options.

    • Find the right property typeHere are the potential rewards of investing in the following property types:.

      SINGLE-FAMILY HOMES tend to produce a more stable cash flow, compared to other types of residential real estate. They also come with lower turnover rates than condos and townhouses. And if you decide to stop leasing or renting them out, you can opt to move into the house yourself or sell it for a profit.

      MULTI-FAMILY HOMES provide better protection against the risk of halted cash flows in the event of a tenant moving out. If a tenant of a single-family home decides to move elsewhere, the unit will sit vacant until the next tenant comes along. With an apartment building, this risk is mitigated by the fact that if one unit is vacant, the other units are likely to remain occupied, which assures consistent cash flow. Additionally, any improvement you introduce to the building can boost the market value of the entire building, not just of one unit.

    • Choose the right locationYou also need to identify the best location for your investment, especially if you intend to manage vacation rentals.

      WATERFRONT PROPERTIES, which cost more upfront because of their scarcity, are valued for their location and community amenities more than the house itself.

      SINGLE-FAMILY HOMES AND SPRAWLING ESTATES In Venice, FL can be found in communities like Casey Key and the Venetian Golf and River Club.

      WATERFRONT CONDOS on Nightingale Road and the other neighborhoods in South Venice come in a variety of options. Units typically have 3 bedrooms and 2 bathrooms, which make them ideal for families.

      WATERFRONT RENTALS FOR TENANTS OR TOURISTS are located along the Gulf of Mexico, the Intracoastal Waterway, and the canals of Venice, FL. Some communities, like Casey Key, offer both Gulf and Intracoastal Waterway views.

      WATERFRONT COMMUNITIES including the master-planned Venetian Golf and River Club, sit right on the Myakka River.

    • Find out where people liveIN VENICE, 60% OF THE RESIDENTS STAY WITHIN THE CITY’S METROPOLITAN AREAS. Properties that are in or close to downtown Venice will make for rewarding investments, such as those found in:
      • The Island of Venice
      • Islandwalk at the West Villages
      • Grand Palm
      • Toscana Isles
      • Southbay Yacht and Racquet Club

      NEIGHBORHOODS WITH THE LARGEST RECORDED INCOME GROWTH cater to tenants who might want to move into better residences and have the financial means to make that happen. Venice neighborhoods with the largest income growth in the last five years include:

      • Bayshore Estates
      • IVenice Groves
      • South Venice
      • Nightingale Park
      • Venice Center / Waterside Village
      • Venice Acres / San Lino
      • Waterford / Capri Isles
      • East Venice Ave
      • Mission Lakes
      • Blue Heron Pond
  2. Investment strategies in commercial real estate

    man opening his shop

    For investors who can afford a bigger capital outlay, commercial real estate is a viable option for the following reasons:

    • Diversification. Commercial real estate is a great way to diversify your investment portfolio and, thus, gain protection against potential losses should your other investments underperform.
    • Cash flow. Investing in retail property, office space, and other types of commercial real estate also assures you of a steady cash flow.
    • Tangible asset. Commercial real estate is also a tangible asset with the building and land providing  intrinsic value.

    In Venice, promising areas to scout for investment property include:

    • Venice Avenue, the city’s commercial and retail hub since the 1920s
    • Other areas to check out
      • James Street
      • Grove Street
      • Commerce Drive
      • Sunset Lake Boulevard
      • Nokomis Avenue
      • Banyan Drive
      • Cypress Avenue
      • Tamiami Trail
  3. Investment strategies in land and development

    measuring land on sunset

    Investing in raw land to develop in Venice, Florida is also a prime move as it assures you of having:

    • Less competition. There are fewer people owning raw land and then selling it than there are investors marketing or selling developed properties.
    • High appreciation potential. Another main advantage that comes with raw land is its appreciation potential. Land is finite – you just can’t make more of it. Thus, with issues like housing shortages and the shifting patterns of homeownership moving towards more rural areas, investing in raw land is looking good. In the wake of the pandemic, open lots in less populated areas have seen a surge in demand and increase in real estate prices by as much as 92% in places like North Point and Saasota, FL. But, due diligence is key. Scammers are now using raw land to deceive investors by posing as landowners.
    • Development options. As Venice’s economy continues to grow, you can explore the many opportunities available to you to make the most of your investment.

    To find which land to invest in, consider the area’s growth potential by:

    • Evaluating the surroundings. In Realtor.com’s assessment of the highest appreciating areas for undeveloped land, it also evaluated the surrounding towns, suburbs, and smaller urban areas.
    • Tracking appreciation rates by quarter or across several months and years using data from reliable sources.
    • Assessing factors such as:
      • Population growth
      • Economic growth
      • Infrastructure development
      • Zoning and land-use regulations
      • Market data and trends
      • Demographics
      • Location

FINANCING YOUR INVESTMENT

man looking on imaginary cash bag and question mark

There are various options to fund a real estate investment.

  1. A conventional mortgage or bank loan. With this funding option, the lender may require up to 35% down payment, which is up to 15% more than the average amount expected for a down payment. A solid credit score and credit history are also necessary to be approved for a mortgage or bank loan.
  2. A hard money loan. This loan is anchored on the investment property itself and functions as a bridge loan. This is a short-term loan used in real estate to provide temporary financing until the property is sold or a more traditional form of funding is secured. Therefore, the short-term nature of hard money loans and the higher perceived risk mean interest rates are higher compared to traditional loans. As such, hard money loans work best when flipping properties, which takes from six months to one year before the renovated property is once again ready for the market.
  3. A private lender. The main benefit of this option is that the funding is released in as short as seven days. Again, a private lender can charge higher interest rates than banks.

man filing form

Once you’ve identified how and where you’re investing, as well as what type of property to invest in, the next thing to do is to familiarize yourself with the legal and regulatory implications of investing in Venice, Florida.

Buying waterfront property, for instance, involves rules and regulations pertaining to:

  • Permits, third-party access, and restrictions placed on the construction of docks or related facilities
  • Existing gaps, margins, or hiatuses between the property and the waterway
  • FEMA compliance for properties built in flood-prone areas
  • Seawalls and their structural integrity

Additionally, you also need to deal with the following:

Zoning and land use regulations in Venice, Florida

Venice, Florida has very specific zoning and land use regulations that all investors must meet to ensure that their real estate investment is protected from fines arising from violations and/or legal action.

Commercial real estate, for example, comes with strict stipulations on accessory uses, which refer to secondary functions or activities that are conducted on a property in addition to its primary use. Retail stores and car washes might be limited to just an office and a parking area for accessory uses. In Venice, FL, accessory uses for hotels, motels, and private clubs  include auditoriums, convention and meeting facilities; restaurants (indoor or outdoor); bars (indoor or outdoor); beauty salons and barber shops, laundry and dry cleaning pick-up stations, gift shops, docks, and so on,

Development standards in Venice, FL vary according to area.  In Venice Avenue, for example, a building can only rise to 35 feet (45 feet, with height exception). Moreover, the architectural elements of buildings within the city’s Historic and Venetian Theme districts are subject to the review and approval of the Architectural Review Board.

For residential properties, zoning and land use laws also differ according to property type. What applies in a single-family attached home could be different from what is required from a single-family detached home or a townhouse.

Taxes

In Florida, property tax is collected on all real and tangible assets. In Venice, residential property taxes are slightly higher than in other parts of the state.

Terms you need to know  include:

  • Market value. The appraised amount of what a buyer is willing to pay for a property.
  • Exemptions. Deductions that apply to certain properties that meet special standards, as in the case of facilities for people with disabilities.
  • Assessed value. The market value of the property in relation to Florida’s Save Our Homes tax cap. This amendment limits increases in the value of a primary residence to 3% or lower every year.
  • Taxable value. The assessed value of your property minus qualified exemptions.

ESSENTIAL TIPS FOR SUCCESSFUL REAL ESTATE INVESTMENTS IN VENICE FLORIDA

Due diligence book phrase

It can be a little challenging to wrap your head around all the things that you should consider when investing in Venice. Therefore, part of your real estate investment strategies involves the following:

  1. Conducting due diligence

    To ensure the success and profitability of your real estate investment, you must do your homework. Research the key locations that come with the highest potential for positive returns, understand the various property types and investment vessels that you can choose from, and get to know the local market to make informed decisions.

  2. Working with real estate professionals

    Partner with top real estate agents in Venice, FL , as they will be instrumental to your success as an investor. Your agent will make sure that you:

    • Have access to the best properties that meet your budget and requirements, including off-market listings
    • Get proper guidance on the local laws that you need to be mindful of when purchasing and investing in property
    • Have your interests represented at every phase of the transaction
    • Tap into your agent’s local network to find allied professionals to assist you

    When choosing top real estate agents in Venice, FL look for:

    • Extensive local experience
    • A track record for dealing in investment properties
    • A stellar reputation
    • Awards and recognition
    • A good network of professionals in allied industries

    Although Florida does not require an attorney on real estate transactions, hiring a local real estate attorney will be able to help investors with:

    • Title examinations
    • Real estate development agreements
    • Preparing and reviewing documents
    • Zoning compliance and permits
    • Resolving disputes

HOW THE GULF COAST INTEGRITY GROUP CAN HELP

The Gulf Coast Integrity Group draws from years of experience in the real estate market of Venice, FL and other Southwest Florida communities. We can help you appy  real estate investment strategies and as they apply to your specific investment goals.

With our assistance, you can look forward to a rewarding and profitable endeavor.

Give us a call at 941.626.4518 or 941.539.3746 and let’s discuss your goals and budgets! You may also contact us here.

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