Investing in St. Petersburg Real Estate

  • Natalie Scott
  • 03/7/22

Known for its luxury real estate, art scene, and great weather—St. Petersburg, FL, continues to tempt buyers and investors. With its idyllic properties, diverse neighborhoods, and abundance of activities and attractions, there's something for everyone in this coastal city. But before you jump in and start bidding on St. Petersburg homes for sale, it's important to understand the St. Petersburg real estate market and what to expect as a buyer.

Life in St. Petersburg

John’s Pass Village & Boardwalk
 
Regardless of if you’re seeking a primary residence, vacation home, or investment property, “Sunshine City'' is ready to welcome you. New residents and potential buyers of homes for sale in St. Petersburg are sure to enjoy the temperate weather, idyllic beaches, wealth of artistic activities, and public parks that make the town such a fun place to live. With average year-round temperatures in the 70s, it makes complete sense why St. Petersburg’s 35 miles of beaches are such a huge community attraction.

Be sure to check out St. Pete Beach, which was ranked as the top beach in the nation by TripAdvisor in 2021. Or Madeira Beach, with John’s Pass Village & Boardwalk, where you can split time between the beach and the 50+ shops nearby.
 
Salvador Dalí Museum
 
To take in all the St. Petersburg art scene has to offer, residents of St. Petersburg real estate should visit the city’s seven art museums, as well as its many galleries and murals located around the city. Museum-goers especially shouldn’t skip a visit to the Salvador Dalí Museum and the Museum of Fine Arts.

As for art galleries, be sure to check out The Factory, part of St. Petersburg’s popular Second Saturday Art Walk. As for murals, one cannot walk or drive around town without seeing the hundreds of murals that adorn the city’s walls. Locals particularly enjoy the annual SHINE Mural Festival, which brings new murals to the city each fall.

Visitors and residents of St. Petersburg real estate enjoy the local parks and trails the city provides, like those found at Boyd Hill Nature Preserve, and Fort De Soto. Comprising 245 acres, Boyd Hill Nature Preserve offers a weekly bike tour on Wednesdays for participants to learn about preservation efforts, check out local wildlife, and see sculptures by Paul Eppling.

The Weedon Island Preserve invites visitors to explore a three-mile hiking trail, a four-mile canoe trail, and the Cultural and Natural History Center. Fort De Sota covers 1136 acres, five keys, and 6 miles of beaches.

What type of buyer are you?

Primary Residence

Buyers of St. Petersburg real estate should note that the area has low inventory compared to 2020, maintaining an overall downward trend in available homes since the highest peak seen in January 2019, with only 360 homes available in January 2022. Homes for sale in St. Petersburg have maintained a 5-year-high for a median list price that started in April 2021 at $315,000, and grew to $399,000 by January 2022. Buyers should note that closing time from initial listing averaged between 50-100 days from April 2018 to January 2021, but dropped to under 40 days from January to June 2021. Time on the market has dropped even further to just 24 days as of January 2022, so buyers can expect to close quickly after their offers are accepted.
 

Investment Property

Real estate investors interested in St. Petersburg real estate should note that 65% of the city’s residential property is owner-occupied, but there is still a solid market for standard monthly rental income and temporary rental income from services like Airbnb.

Standard monthly rental income for St. Petersburg real estate has increased steadily over the past five years and performed well in a year-over-year comparison from January 2021 to 2022. In looking at the increases across all five property types, there was an average increase of 1.62% across five years and 1.23% from 2021 to 2022.

Studio apartments rose from $718 a month in median rent in January 2017 to $1271 in January 2022, which was also an increase from January 2021’s $1201 monthly cost. This equates to a 77% increase in median rent for studio apartments from 2017 to 2022, and a 6% increase for 2021 to 2022. Based on January 2022’s median, buyers can expect to earn $15,252 annually in rental income for studio apartments in St. Petersburg.

Single bedroom St. Petersburg real estate increased in monthly median rent from $859 in January 2017 to $1252 in January 2021 and rose again to $1452 in January 2022. As such, an increase of 45% was seen in the four-year comparison and 16% for the year-over-year comparison. Buyers can expect $17,424 in rental income in 2022 based on January’s median rent.

Properties with two bedrooms increased from $1350 median rent in January 2017 to $1677 in January 2021 and again to $2170 in January 2022. The four-year comparison shows an increase in median rent of 24% and 29% from 2021 to 2022. Owners of 3 bedroom properties can expect to earn an average of $26,040 in rental income.

Owners of homes for sale in St. Petersburg with three bedrooms can also expect rental profits to trend upward based on the four-year and year-over-year comparisons. Given that the median rent of 3-bedroom homes in St. Petersburg was $1447 in January 2017 and increased to $1962 in January 2021 and to $2588 in January 2022. This equates to a 35% increase in median rent over a four-year span, and an increase of 32% from 2021 to 2022. Based on January’s median rent, owners can earn an average of $31,056 on 3-bedroom property rentals in 2022.

4-bedroom properties increased from a median rent of $1611 in January 2017 to $2105 in January 2021, and to $2738 in January 2022. This four-year comparison shows an increase in median rent of 31% and 30% from 2021 to 2022. January’s rent indicates an average income of $32,856 for 4-bedroom homes in St. Petersburg.

If you plan to use your St. Petersburg property as both a getaway for yourself and a vacation rental, Airbnb indicates the average cost for a one-night stay in St. Petersburg is about $233 per person. This means you could bring in as much as $85,045 in rental income if you are able to host a guest each night of the year, or at least 365 guests annually.

Hunting for St. Petersburg investment properties?

If you’re thinking about buying St. Petersburg real estate in 2022, reach out to trusted local realtor Natalie Scott for keen market insights, negotiation, and stress-free customer service.



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