By Debbie Flessner
If you’re a Siesta Key resident, someone who resides anywhere in Sarasota or even a visitor to our lovely island, it’s certainly no secret to you that this is a special place to live.
Siesta Key is an eight-mile-long, crescent-shaped barrier island that is, quite literally, a slice of paradise. From its cool and funky north and south end shopping and restaurant districts to its pristine, internationally renowned beaches, the Key is one-of-a-kind.
Not surprisingly, once the many people from around the world visit our island, they decide they would like to live here—at least part-time. That’s one of the reasons the real estate market on Siesta Key, through thick and thin, remains a viable one.
Joe Kesslak, who works at RE/MAX Alliance Group on Ocean Blvd. with his wife Wendy, said that the way Sarasota County trends in real estate sales isn’t necessarily the lead that Siesta Key follows.
“Over the past five years, prices here have gone up 7 to 8% on the average annually,” he said. “Right now on Siesta Key, we have 510 total properties for sale, with 91 of those pending, and of those 419, 166 are single-family homes and 233 are condos. From April of 2018 to April of 2019, we had a 5% increase in sales prices on the Key.”
During the same time period, according to figures provided by Sarasota/Manatee Realtor magazine, the median sale price of homes in Sarasota County as a whole rose only 1.5%.
Joe and Wendy specialize in investment properties on Siesta Key, and stress that the rental market here has remained strong. As it turns out, exposing tourists to all the island has to offer is a great way to turn happy vacationers into enthusiastic buyers.
“Statistics show us that properties are only listed for 83 days here before they sell, except for properties that are zoned to allow weekly rentals-those sell quicker,” Wendy said. “That ability to rent year-round is what makes it more valuable for investors.”
While an investor might think, “Well that’s fine, I’ll just rent in a spot on the island that is zoned for short-term rentals,” that’s easier said than done. If your property is zoned RMF-1 (Residential Multifamily), that allows for transient accommodations and short-term rentals. But with a zone designated RSF (Residential Single Family), you may only lease your property for a period of 30 days or more at a time—which translates to a maximum of 12 times a year. The problem is that sometimes two properties located next door to each other will have different zoning designations.
Dan Miller, a Realtor with RE/MAX Tropical Sands, on Old Stickney Point Road, also specializes in investment property. He says that he tells his clients who are looking to make such a purchase to carefully consider what the regulations are for the location.
“If you’re looking to buy an investment property, you should buy in the correct zone,” he said. “I get clients who are relocating here, and people who are looking for a second home, but most of my sales on Siesta are condos, because people can use them for an investment. During season, they can put renters in their unit for the entire time because of the way they are zoned.”
After all, when investors purchase a property, one of the goals is to not lose money. The ultimate goal, however, would be to make money and have a vacation home at no cost. Joe Kesslak gave an example of a two-bedroom/two-bath condominium that grosses $40,000 in rent income every year. He said that after an owner pays 20% to a property management company, they should have about $32,000 to cover Homeowners’ Association fees, utilities, maintenance and more, which would all probably cost no more than $15,000. That would leave $17,000 for mortgage payments, most likely more money than would be required.
The end result? An investment property that pays for itself.
Needless to say, many of those investment properties are changing hands between out-of-town buyers and sellers. Dan Miller said that is definitely the case with his clientele.
“Very rarely do I sit down at a closing table with both the buyer and the seller,” he said. “The closings are typically ‘mail aways.’”
Mail away closings are fairly common, taking place between parties that can’t be physically present at a closing. The absent party is sent paperwork to sign in front of a notary, after which they return the documents to the title company handling the closing. Necessary closing funds are wired to the appropriate destination.
The emergence of the Siesta Breeze Trolley on Siesta Key has made our little island even smaller, and has opened up the southern end to even more investment opportunities, because of the ease of getting to Siesta Village. An open-air trolley service that is operated by Sarasota County Area Transit (SCAT), the three vehicles run between Turtle Beach and Siesta Village seven days a week, starting at 10 AM. The trolleys are free, and no tips are accepted, meaning that riders can go back and forth and anywhere in between without having to worry about parking or picking a designated driver.
Both the Kesslaks and Dan Miller say that while the Siesta Key market real estate market is not necessarily on fire right now, it’s steady and very healthy. Wendy, who invested heavily in Siesta real estate with Joe before they actually moved here, said she expects the market to remain solid.
“This place just has a special feel—like you’re in the Caribbean,” she said. “It has very much an island feel, and it’s still very lush with foliage. That’s what gets people, and when they experience what we have here, they want to be a part of it.”