Tips on Buying a Home in or near Pensacola or on Pensacola Beach.
The Pensacola Real Estate Scene –
The straight scoop on how to purchase a home in Pensacola from a veteran of the Pensacola Real Estate Business.
So… you’ve decided to move to Pensacola?
Great! Seriously… you’re gonna love it here. There is a lot to do, or if you are moving for the peace and quiet, this is available, too. IF you know where to live.
Some Rules of Thumb:
For every mile you drive inland from the coast or center city Pensacola you can expect to pay about $1,500 less for the same exact house. This is because of the demand created by those who want to live near water or downtown.
Communities with dues are not necessarily a good or bad buy
You should purchase a home in a community when you are absolutely sure the amenities will provide value for you and/or your family over time. Think of dues as additional taxes. Taxes are to provide services. If you don’t use the services, why pay the tax?
And what is important here is to consider the future. If you find value in the pool, tennis court and clubhouse for your children, weigh in your decision just how long you expect them to be living with you. If only for a few years, you might be better off living outside a community and joining a local YMCA. Selling the house after they are gone and you are not getting value for the amenities can be costly, with transfer taxes, commission and etc.
In the woods or in town?
There are pockets of suburbia here in the Pensacola. But with the Gulf and beaches on one side and because of terrain and wetlands, we all seem to live either in the woods, in town or in a “community”. If you want to live in town, you’ll probably end up in an older home requiring more maintenance. If in the woods, well…. there are animals to contend with along with a drive of a few miles for the basics.
Communities are scattered across the entire 1 hour drive across the Pensacola. Some are older communities with history and other are newer. Finding just the right community will take you months (or maybe even years). This is where you will need help from an experienced agent. Note: I say experienced, because newer agents just haven’t the depth of experience and time to visit all of the hundreds of communities. Plan on paying for a fairly new car that you will keep in top condition if you choose to live outside of town. At least two if you have 2 or more drivers.
Resale or new? If you would never buy a used car … the decision is already made… you are going to build. If you enjoy tinkering and fixing, a resale is more likely your choice. But, some of you fixers are going to find out you just can not find the house you want in the resale market… and you’ll be converted to building.
Here in Pensacola there is some cooperation between real estate brokers and builders. You should consider using a real estate agent even if you plan to purchase a newly constructed (or about to be constructed) home. Here, if you ask most Real Estate Brokers to guide you through the maze of builders, you’ll find a friendly answer and an offer to show you around to the communities where builders are active . Find the right Real Estate Broker, and he/she will be invaluable in helping you find the right builder for your lifestyle.
See the Pensacola Builders Showcase for a Brokers perspective and recommendation of the best builders. Rule: there are new homes in town and in the suburbs …. So, a broker can help you navigate the choices.
Working With a Real Estate Agent To Buy a Pre-Owned Home:
A young real estate agent or a good real estate agent? Almost any agent can show you almost any home (We have a Multiple Listing Service.) So, if you find an agent who you suspect is not experienced…. move on. The question is not to be taken too literally, but the concept is important, you will want to ask your potential agent some questions:
— “Agent… how long have you lived here?” We get a lot of people moving to the area who fancy they would like to sell homes. Yet they know little about the roads, neighborhood amenities, community restrictions and zoning, building codes and etc. If the answer is “less than 10 years”… move on and find another agent.
— “Agent…. how many buying transactions have you handled?” If the answer doesn’t come back in the hundreds….move on and find another agent. Or ask he/she to partner with a more experienced agent to handle your transaction.
— “Agent… where should I go for a mortgage?” If the first answer is “a mortgage broker ?” and not “your current bank” or a “local bank”…. be careful there may be an affiliation and you may not be getting the best deal. Many mortgage brokers just process your package, add fees on top and send the information to a local bank anyway. You don’t want to pay the extra fees.
— “Agent… Should I use an attorney?” The answer should be “Yes, let me recommend a few for you to contact, and at least, have them review the agreements” AND he/she should recommend at least three.
Finding a New Home:
As mentioned earlier, Builders and Real Estate Agents, some timea are at odds here in the Pensacola. But, I think that you SHOULD have an agent work with you through the process of purchasing a new home. Just be sure to have the right agent. One with experience in new construction. He/she can help you understand the process, the financing issues, and provide some guidance through the selection of a neighborhood and builder.
If you’ve selected the right agent he/she will know the market, location issues and reputation of the builder. You might consider reading our column on Buying a Pensacola Home for additional advice.
Select an agent prior to registering at any new home model you visit. Discuss with your agent whether the home you want must be new or whether you can find a similar home in the resale market for less. Then have your agent accompany you to the new home neighborhoods and models. He / She can offer advice about the home and neighborhood, insulate you from any pressure in the sales process and suggest other communities or builders for you to consider.
Buying a Vacation or 2nd Home in the Pensacola
Why to Buy — House too small? Just need to get away more often? Coming to the beach a lot and want to save on hotel bills? Existing waterfront too expensive? Need a tax deduction?
There are plenty of reasons folks buy a vacation home at the beach or in town Pensacola. Some suggestions to make your purchase easier and more profitable:
Rent or Personal Use: Decide in advance if renting the home is important to you. (Or if you need to, to afford it.) If so, the location of your new rental home is the most important factor to consider. The best grossing rental homes are next to the beach. This is a supply and demand issue. Families will pay more to be near the beach and water.
Conversely, if you have a “house in the woods” or in a “lake community” there may be some “one season” demand but, if that season is the summer … there is, also, a much larger supply of homes available for rent and the rental rates are substantially lower. Careful about using just any real estate broker to handle your rental home…. Some use rentals as a method to get homeowners in the door to establish a contact for a later sales listing.
Many, many homes are rented by the homeowner’s themselves by placing ads in newspaper and online sites like airbandb and www.craigslist.org.
Where to Buy — Location Determined By Amenity Choice. Water front, beach rights, river front, view, proximity to activities, stream side, tennis courts, social activities at a clubhouse are some of the amenities that might drive you to a particular home. You can expect to pay a premium for these choices.. it seems to run in this hierarchy Beach front, Gulf view, Bayfront, Golf Course, short view, river front, stream side, access to tennis and pool.
Currently large beach front lots are in hundreds of thousands for the lot, beach views around $350,000, and if any view is combined it will be more. Add this to the cost of the home (anywhere between $150 per sq.ft.to $400 per sq. ft.) and you can estimate what you can expect to pay.
Most “gated” communities and a few un gated “Vacation” neighborhoods have tennis and pool(s) some indoor and some out. The important thing to be aware of if you buy in a neighborhood with these two amenities is that a pool (especially and indoor pool) is expensive to maintain and operate. Due will be substantially higher in these neighborhoods and others. So… If you can do without the pool.. you should probably not consider a community with one.
How to Buy – Find an agent who has been around Pensacola a Long time. Someone who is familiar with all the neighborhoods and their amenities and reputations. Expect to spend sometime looking, unless you have specific desires – Gulf front, long view, close to water, or distance to the beach. If you are wanting one of these, there will only be a few on the market and you will want to act somewhat quickly when you find one that suits you.
Expect to pay more for financing than you would on a primary home. –– Most banks require either more than 20% down or a higher interest rate on a second home. They also like to see the term about 20 years. This is to reduce their risk. Some people purchase a second home with an equity loan on their primary residence. (Costs are less and the rate is usually better) IF they have the equity available. There may be some tax advantages, (see your accountant).
For more guidance on purchasing a Pensacola Beach home: