New Condos in Naples
Jan 27th, 2005 | 03:55 AM
#1
Original Poster
Joined: Feb 2003
Posts: 18,507
Likes: 1
New Condos in Naples
My nephew who lives in Weston, FL is trying to convince us to buy a condo in a development being built in Naples. I'm not sure of the exact location. It is called Positano Place and is being developed by Cypress Naples, Ltd. It is about four miles from the beach on the same road at the Ritz.
Do any of you Naples experts know anything about this and think it would be a good investment??
Do any of you Naples experts know anything about this and think it would be a good investment??
Jan 27th, 2005 | 05:03 AM
#2
Original Poster
Joined: Feb 2003
Posts: 18,507
Likes: 1
I found more about the location. It is located South of Pine Ridge on Livingston Rd. Anyone think this area is a good inverstment. We are hoping to rent it until we retire in a few years and then will use it for a winter home.
Jan 27th, 2005 | 05:22 AM
#3
Joined: Jan 2003
Posts: 15,749
Likes: 0
If anyone could give you a definitive answer regarding that, they would keep it to themselves and buy it up.
I am not familiar with that development or that developer, but that doesn't mean much -- I can't begin to keep up with them here in Naples. It is an OK area, where there is a lot of building. But that is true everywhere north and east in Naples and it will continue to spread out that way.
Here's the bottom line. It is doubtful that any but the worst built and worst developed area could lose you money. Nearly everything goes up. Some a whole lot more than others. The real problem is that so many new places keep getting built that people who want to sell those after a few years have a real problem breaking even -- because most new buyers are like you -- they want something new, not something that is 5 or 10 years old. So it may take some time.
You say you will rent it for a while (not always easy, and almost guaranteed that the rent won't pay your expenses, but may nicely help to offset some of them) and then use it for a winter home. So the bottom line is that you want to make sure it is where you want your winter home? I sure can't imagine buying something for a future home sight unseen. When are you coming to look at this and compare it to other places?
I bought a condo in North Naples in 1982 for $69,000 for investment. I did it as a model and leased back to the builder for the year until the units sold out, then rented it to the woman who had been sitting the model and her husband as a furnished rental. Guess what -- 22 years later she is still the tenant!! She's more than paid for it, and my mortgage has been paid off in full long ago. That, however, is one very unique story here. But the condo itself is probably only worth about $119,000 to $129,000 now. Here in Naples, that isn't much increase in value in 23 years.
By comparison, the condo I bought in Olde Naples 9 years ago has more than tripled in value -- no, I'm not kidding. Why the difference? Because they can't build another Olde Naples -- it's long built out. But they can build hundreds of new condominium projects in the country, so it is harder to get the value to go up.
If you're really looking for a good investment -- one that will increase more greatly in value, I'd actually work with a good realtor and look at resales in prime locations. Sure it will seem like you get more for your money at the new places, but 10 or 15 years from now, you'll realize a far greater value. Which is more important -- having something new or seeing a greater return on your investment?
One other word of wisdom. If you do go into a new project, do not buy the smallest or cheapest unit. Always buy the biggest or the best one. In most developments after a few years, there will be people who want to "move up" and the value of the bigger more expensive units will increase at a higher rate than the other ones. In the gulf front condos, there have always been penthouses originally selling at an average of 50% more than the other units. But within 10 years, the owners of the penthouses can sell them for at least double or triple what the other unit owners can sell theirs far. In Naples, it seems to be all about the "biggest and the best".
Good luck.
I am not familiar with that development or that developer, but that doesn't mean much -- I can't begin to keep up with them here in Naples. It is an OK area, where there is a lot of building. But that is true everywhere north and east in Naples and it will continue to spread out that way.
Here's the bottom line. It is doubtful that any but the worst built and worst developed area could lose you money. Nearly everything goes up. Some a whole lot more than others. The real problem is that so many new places keep getting built that people who want to sell those after a few years have a real problem breaking even -- because most new buyers are like you -- they want something new, not something that is 5 or 10 years old. So it may take some time.
You say you will rent it for a while (not always easy, and almost guaranteed that the rent won't pay your expenses, but may nicely help to offset some of them) and then use it for a winter home. So the bottom line is that you want to make sure it is where you want your winter home? I sure can't imagine buying something for a future home sight unseen. When are you coming to look at this and compare it to other places?
I bought a condo in North Naples in 1982 for $69,000 for investment. I did it as a model and leased back to the builder for the year until the units sold out, then rented it to the woman who had been sitting the model and her husband as a furnished rental. Guess what -- 22 years later she is still the tenant!! She's more than paid for it, and my mortgage has been paid off in full long ago. That, however, is one very unique story here. But the condo itself is probably only worth about $119,000 to $129,000 now. Here in Naples, that isn't much increase in value in 23 years.
By comparison, the condo I bought in Olde Naples 9 years ago has more than tripled in value -- no, I'm not kidding. Why the difference? Because they can't build another Olde Naples -- it's long built out. But they can build hundreds of new condominium projects in the country, so it is harder to get the value to go up.
If you're really looking for a good investment -- one that will increase more greatly in value, I'd actually work with a good realtor and look at resales in prime locations. Sure it will seem like you get more for your money at the new places, but 10 or 15 years from now, you'll realize a far greater value. Which is more important -- having something new or seeing a greater return on your investment?
One other word of wisdom. If you do go into a new project, do not buy the smallest or cheapest unit. Always buy the biggest or the best one. In most developments after a few years, there will be people who want to "move up" and the value of the bigger more expensive units will increase at a higher rate than the other ones. In the gulf front condos, there have always been penthouses originally selling at an average of 50% more than the other units. But within 10 years, the owners of the penthouses can sell them for at least double or triple what the other unit owners can sell theirs far. In Naples, it seems to be all about the "biggest and the best".
Good luck.
Jan 27th, 2005 | 10:11 AM
#4
Joined: Jan 2003
Posts: 1,212
Likes: 0
How funny, I am working on buying a pre-construction condo in Naples too (with family and friends). Once it is finished (~2 yrs from now) we plan to immediately sell it. Thanks, Patrick, for telling us of your experiences. It gives me more confidence in my decision to invest. I'm a relative beginner when it comes to real estate, but my experiences so far have been very good! (knock on wood)
