Value of waterfront property remains high
According to the U.S. Geological Survey, 70 percent of the Earth’s surface is water, most of which is ocean water. The high percentage of water on our planet does not, however, mean that we have a lot of waterfront land to build on, just the opposite; waterfront land is scarce, which is why there is always a premium to live on the water.
According to Knight Frank, a global independent real estate consulting firm, luxury vacation homes built on the water cost 63 percent more on average than similar properties that are landlocked.
Knight Frank determined this by analyzing 10 waterfront home markets worldwide and coming up with an average of 63 percent.
Two of the markets were in the United States, one in Miami where the average premium for waterfront property was 60 percent and the Hamptons in New York where the average premium was 30 percent. Even though some of the other real estate markets analyzed are not relevant to Florida, it’s fun just to see what the premiums are; Lake Como, Italy, 100 percent; Central Algarve, Portugal, 75 percent; Barbados, 100 percent; and Phuket, Thailand, 89 percent.
Waterfront land is generally more expensive to develop which also adds to the overall value but the real reason for paying a premium for waterfront property is the exclusive nature of the property. Usually waterfront not only provides privacy but also has a certain amount of prestige associated with ownership. Naturally the premium is affected by how unobstructed and spectacular the waterfront views are.
Anna Maria Island obviously has a lot of waterfront and water view properties some with spectacular views and many with really nice views. According to a search on realtor.com, Anna Maria city has 19 either waterfront or water view properties for sale ranging from $3,299,000 to $634,900. Holmes Beach and Bradenton Beach have a combined total of 105 waterfront or water view properties listed for sale ranging from $3,475,000 to $129,900. These properties include single family houses, duplexes, condos and vacation condos and are either beach front, canal or lake properties.
Keep in mind that the definition of waterfront and water view is very subjective and varies from property to property. A condo with a view of the Gulf from a side balcony is still considered water view and a single family home at the end of a canal is considered waterfront. When I lived in a waterfront community in New York there was a popular phrase used when attempting to enhance a water view by listing the property as having a “winter water view” meaning when the leaves were on the trees in the spring and summer there was none.
Nevertheless any kind of water view has value and there is no doubt that Anna Maria has some of the best waterfront and water view properties in all of Florida which certainly explains the escalation of our market in recent months. Waterfront and water view properties are a secure investment; there are only so many properties available and even less vacant land. If you can afford it or if you can stretch your buying power just a little, buying waterfront or water view is always a good decision.
Water is plentiful but waterfront property is not and it will cost you because of the basic principal of supply and demand. The old maxim that the three secrets to real estate are “location, location, location” was never truer then when talking about waterfront living, it is typically the best location available.