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Daytona Beach: Real Estate and Market Trends

Published on Monday - May 11, 2015

The Daytona Beach housing market can be summed up in one word: affordable. In fact, the current median home price for Daytona Beach is $132,000, or approximately $76,000 less than the national average. The appreciation rate in Daytona Beach has gone from 32.3 percent just three years ago, to 2.3 percent in the last 12 months, which would account for the difference in values. While not what they were three years ago, appreciation rates across the country are still more than twice as much as Daytona Beach.

Even with price growth slowing, the Daytona Beach housing market has made considerable improvements since the worst part of the recession. Homeowners in the area have begun to see growth in positive equity. Daytona Beach real estate investing, in particular, has even seen improvements thanks to increasing home values. Subsequently, Daytona Beach is one of the best cities to flip houses. The following highlights how much equity has been gained relative to the year of the home’s purchase:

View of Daytona Beach from the sky

  • Homes purchased in the Daytona Beach housing market one year ago have appreciated, on average, by $4,967. The national average was $14,170 over the same period.
  • Homes purchased in the Daytona Beach housing market three years ago have appreciated, on average, by $37,194. The national average was $53,857 over the same period.
  • Homes purchased in the Daytona Beach housing market five years ago have appreciated, on average, by $18,689. The national average was $48,036 over the same period.
  • Homes purchased in the Daytona Beach housing market seven years ago have depreciated, on average, by $32,366. The national average increased $13,870 over the same period.
  • Homes purchased in the Daytona Beach housing market nine years ago have depreciated, on average, by $50,384. The national average also dropped $2,822 over the same period.

While Daytona Beach hasn’t exactly been the picture of a perfect economy, people in the area have reason to celebrate a renewed optimism. The end of the downturn has essentially opened doors to attract high-end development that will create jobs and expand the local tax base. Supply and demand within the Daytona Beach housing market should remain steady, as a result. That said, the area’s unemployment is better than the national average and improving. At 5.3 percent, Daytona Beach unemployment is 0.3 percent lower than the rest of the country and 0.7 percent better than last year.

There are very few markets ahead of Daytona Beach in terms of real estate investing. In fact, there is only one: Baltimore. According to RealtyTrac, Baltimore is the best metropolitan area to flip a home. Baltimore investors saw a return on investment as high as 94.1 percent in the first quarter. However, as this is a piece on Daytona Beach, the Florida city is officially the second best area to flip houses in the country. According to RealtyTrac, Daytona Beach real estate investing is accompanied by a 74.7 percent return on investment. While that is nearly 20 points lower than Baltimore, it is enough to place the Daytona Beach housing market second on the list of best places to flip a home.

In addition to the Baltimore and Daytona Beach metro areas, other top flipping markets included Ocala, Fla. (73.9% gross ROI); Lakeland, Fla. (62.5% gross ROI); and Detroit, Mich. (58.3% ROI).

Again, the Daytona Beach housing market is incredibly affordable. It is historically strong and continuing to improve. Recent data compiled by the National Association of Realtors (NAR) suggests that homeowners in Daytona Beach spend about 8.2 percent of their income on monthly mortgage payments. Conversely, the average homeowner across the country spends about 15.1 percent of their income on monthly mortgage obligations. At that rate, Daytona Beach will attract a lot of first-time buyers and those interested in investing.

Daytona Beach real estate investing is thriving because of the local distressed market. According to RealtyTrac, there are approximately 644 properties in Daytona Beach that are in some stage of the foreclosure process. At that rate, foreclosures are 14 percent higher than the last month and 9 percent higher than the previous year. However, if the number of available properties isn’t enough to get Daytona Beach real estate investors excited, the discounts they offer will. The median sales price of a non-distressed home was $98,000. The median sales price of a foreclosure home was $55,100, or 44 percent lower than non-distressed home sales. That is a savings of nearly $43,000 per distressed property. Over the last year, the discount on distressed homes has increased 8.6 percent, making investment spreads that much more attractive.

Forty-six percent of these properties are of a pre-foreclosed nature, meaning that they are at risk of being repossessed because of the owner’s inability to pay off mortgage obligations. Daytona Beach real estate investors should consider these homes to be a great source of deals, as distressed owners can make the best sellers. On the other hand, 36 percent of all distressed properties in Daytona Beach are sitting on the banks’ books as non-performing loans. These are properties that lenders are actively looking to get rid of. The remaining 18 percent of the distressed properties are to be placed up for auction. Daytona Beach real estate investing should consider each of these scenarios as a viable source of deals.

While the Daytona Beach housing market is not as hot as its Florida counterparts, namely Miami and Jacksonville, it is one of the best cities to invest in real estate. The area’s return on investment is the second highest in the country. For all intents and purposes, Daytona Beach will remain a great spot for investors to take up business.

Daytona Beach Housing Market Summary:

  • Current Median Home Price: $132,000
  • 1-Year Appreciation Rate: 2.3%
  • Unemployment Rate: 5.3%
  • 1-Year Job Growth Rate: 1.4%
  • Population: 62,316

Daytona Beach County Map:

Map of Daytona Beach neighborhoods

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