Ranking eighth in the National Association of Realtors’ list of top real estate markets to watch out for in 2023, the Jacksonville real estate market is one of the hottest in Florida.
It ranked on that list due to housing affordability, job growth, and less severe housing shortages. The increasing number of housing inventory and migration growth also make the city a lucrative place to buy or sell a property.
Jacksonville stands out from popular Florida destinations due to its beautiful geography and diverse economy. It also has one of the highest residential property appreciation rates and rental rates in the Sunshine State.
If you consider selling or buying a real estate property in Jacksonville, you may want to know a few things about this market. Read on to find out.
Interesting Facts About Jacksonville, Florida
At 874 square miles, Jacksonville is the largest city in the United States based on landmass. The city stretches across seven Florida counties and currently has a population of 1.2 million people. It is also a growing tourist destination thanks to the perfectly-landscaped golf courses, beaches, warm weather, and ocean breezes.
As an international trade seaport, the city attracts many investors. Its investment potential also comes from the zero income tax policy enacted by Florida legislators.
Jacksonville’s urban park system is four times the size of Manhattan Island. As such, it is the largest urban park system in the country. The park system stretches across an 80,000-acre land comprising an arboretum, 400 city gardens and parks, a national preserve, 2 national parks, and 2 state parks.
The U.S. military is the biggest employer in this city. In particular, its active-duty workforce comprises about 20,000 Jacksonville residents.
With the average age being 36, Jacksonville is the youngest city in Florida. The Sunshine State’s population has an average age of 42.
Jacksonville also boasts 22 miles of spectacular sandy beaches. These sceneries lie on a 1,100-mile of coastal shoreline.
Historical Facts About Jacksonville
General Andrew Jackson is an influential figure in Jacksonville’s history. He was the first military Florida governor, and the city got its name from him. William Pope Duval, who was Florida’s first Territorial Governor, also inspired the naming of Duval Street.
Isiah Hart was the founder of Jacksonville. He named the first two streets of the city after his dear daughters, Laura and Julia. Hemming Park (currently known as James Weldon Johnson Park) is undeniably the oldest public park in Jacksonville.
Even more, Fort Caroline helps remember the efforts of the French to set up a colony in Florida back in the 16th century. And the Ostrich Farm, situated at the Southbank of Downtown, was a tourist attraction in the early 1900s.
Landmarks and Architecture in Jacksonville, FL
The Treaty Oak (planted back in 1822) is one of the oldest landmark features in Jacksonville. It lies on the Southbank and measures 70 feet in height and 25 feet in circumference.
Jacksonville’s St. James Building, designed by Henry John Klutho in 1912, was once a department store. Today, it functions as the City Hall.
Standing at 22 stories, the Prudential Building was once the tallest commercial building in the Southern United States. It now goes by the name Aetna Building.
Friendship Fountain opened back in 1965. At that time, it was the tallest and largest fountain in the world.
Construction for the Dames Point Bridge cost about $117 million dollars. Since its opening in 1889, it ranks as the second longest cable-stayed bridge made of concrete in the entire Western Hemisphere.
The Jacksonville Navy Memorial celebrates the amicable relationship between Jacksonville residents and the US Navy. It lies on Downtown’s Southbank Riverwalk. The statue depicts a young sailor dressed in a uniform with his eyes facing the sea and a duffel bag on his feet.
What Makes Jacksonville’s Real Estate Market Attractive?
The Jacksonville real estate market is affordable, attainable, ever-growing, and profitable. With the average median home price standing at $223,640, there’s investment potential in this city.
The affordable housing market favors buyers looking to own houses and sellers looking to get a fair price for their homes.
Jacksonville continues to rank highly across the country as a market with high appreciation rates and equity gains. In particular, its one-year real estate appreciation rate is 7.5%.
Jacksonville’s projected substantial growth will largely benefit its real estate market. In particular, it will increase the demand for rental homes. The increase in population will sustain the demand for rental properties within the city.
You have to look at the possibilities for short-term renting and the city’s quality of life. Doing this will help you determine Jacksonville’s profitability and sustainability beyond the statistics available.
Either way, if you plan to visit Jacksonville, you should definitely catch the sunset at Atlantic Beach. Exploring Little Talbot Island and seeing exotic wildlife at the Jacksonville Zoo and Gardens are other activities you can do.
And if you want to learn more about the city’s history and science, visit the Museum of Science and History.
The city of Jacksonville boasts a strong and sustainable job market. As such, it is among the most favorable destinations for job seekers across the country. Its job sector continues to grow exponentially as more employment opportunities emerge.
The Naval Station Mayport usually has thousands of job openings in naval stations spread across the city. These job openings increase the demand for houses in Jacksonville. They also help the local economy grow to its targets.
More younger families and job seekers are moving to Jacksonville. The move is due to a favorable economy and job sector.
Expect Jacksonville to record an increase in population and economic growth in the next ten years. The city’s population may increase by a million during this period. It may also double in the metro area in a span of 25 years.
While the city has potential for job growth, it still has an unemployment situation to deal with. In particular, its unemployment rate is about 2.80%. It’s lower than the national average, which is 3.5 percent.
With a healthy unemployment rate, the city may experience growth in its job sector. The lower rate is due to the diverse economic policies and infrastructure in Jacksonville.
Several renowned companies have their headquarters in the city. These companies include Stein Mart, CSX Transportation and Firehouse Subs, among others.
Some companies across the country are also looking to set up their headquarters in this city. As such, they will create more job opportunities, which will benefit the residents and the real estate market.
Home Buying Market
With the increasing demands in housing, homebuyers in Jacksonville will likely have high mortgage rates. The exact figure for the rates will depend on the Federal Reserve’s efforts to control nationwide inflation.
As of 5th May 2023, 30-year fixed mortgages in the country have an annual percentage rate of 6.80%. For a 30-year fixed refinance, expect an APR of 6.90 percent. Interest rates for 15-year and 30-year fixed mortgages in Florida are 6.14 percent and 6.84 percent, respectively.
Homebuyers have multiple mortgage options when looking to buy a property in Jacksonville, FL. One of these options is the conventional mortgage, which is a standard home loan. To qualify, you need a 620 FICO score and a DTI (debt-to-income) ratio of 43 percent or less.
A 749 credit score can help you secure a good rate on a conventional mortgage in Jacksonville. But the loan will need a higher down payment amount.
Lenders will ask you to make at least 20 percent of the mortgage as a down payment to avoid paying for private mortgage insurance. Mortgage insurance helps protect lenders against borrowers who default on loans.
Home Financing Options Available to Potential Homebuyers
Besides conventional loans, FHA loans are available to homebuyers in Florida. You may consider this option if the credit requirements on conventional mortgages don’t favor you.
Through the FHA (the Federal Housing Administration), the federal government backs FHA loans. Approved FHA loan lenders serve borrowers with low income and less favorable credit histories. As such, a 580 credit score can get you qualified for the loan as long as you make a 3.5 percent down payment.
If you are a veteran or a qualifying family member of someone who served in the US armed forces, you may tap into VA loans. With government backing through the Veterans Affairs, VA loans only need a funding fee that is between 1.25 and 3.3 percent of the mortgage. So you won’t have to pay a down payment or mortgage insurance.
Florida’s first-time homebuyer programs can help you buy a property in Jacksonville. In particular, the Florida Housing Finance Corporation runs a program that covers borrowers’ closing costs and down payments. You can tap into this program through FL Housing’s approved lenders.
FL Housing (Florida Housing Finance Corporation) also runs a mortgage program for active duty service members and veterans. It offers 30-year fixed-rate home loans as well as a maximum of $10,000 in closing costs and down payment assistance. The Salute Our Soldiers Military Loan Program is open to Florida residents, including Jacksonville residents.
You can also get a mortgage credit certificate from FL Housing when looking to buy a house. With the certificate, you enjoy tax credits valued at 50 percent of the mortgage.
The Construction Sector
Custom home builders are optimistic about the lucrative Jacksonville housing market. Their projects differ from the mass construction of homes in several ways. In particular, they allocate more time and resources to each custom-built home and may handle less than ten units in a year.
The demand for new custom-built homes is likely to increase. It will come from retirees or downsizers looking for homes with a more personalized touch.
More investors are building properties in Jacksonville with the goal of renting them. They see a potential for renters to occupy these housing units as the job sector and economy in the city grow. Most of the units they are building are multi-family homes such as triplexes and duplexes.
Jacksonville is among many other cities where investors are opting to build housing units to rent to residents. The trend grew when investors started building single-family homes amidst the 2008 Great Recession. Back then, investors turned foreclosed homes into rentals.
As the housing prices became stable after the Great Recession, there weren’t as many opportunities for investors to grow their real estate portfolios. So, building residential properties in select neighborhoods to rent them became the norm. Jacksonville continues to benefit from this home-building trend.
The Rental Housing Market
On average, residents pay $1,522 to rent an apartment in Jacksonville. But the cost depends on the apartment’s quality, size and location.
Apartments in Jacksonville have an average size of 969 square feet. The size depends on the design and target renter. So, expect to find both luxury and cheap rental units in the city.
Studio apartments are the most affordable but the smallest. One-bedroom units are a better upgrade for the studio units. If you want more square footage in your apartment, you may consider 2-bedroom or 3-bedroom units in the city,
Apartments within the $701 and $1,000 range make up 6 percent of the rental housing units. Those within the $1,000 and $1,500 range and $1,500 and $2,000 range form 42 and 43 percent of the rental units, respectively.
57 percent of all households in Jacksonville are owner-occupied. On the other hand, 43 percent of the households are renter-occupied. 57 percent here represents 207,479 households, while 43 percent represents 159,301 households.
Neighborhoods with Rental Homes in Jacksonville
Jacksonville’s neighborhoods with rental homes include Bartram Springs, Bartram Park, Del Rio, Mixon Town and Greenland. Others include Beachwood, Isle of Palms, Northbank, LaVilla and Brooklyn. The average rent in these neighborhoods is $1,700.
Mid-Westside Jacksonville, Magnolia Gardens and Grand Park are the most affordable neighborhoods to rent a house. Their average rent prices are $884 a month.
Greenland, Del Rio and Bartram Springs have slightly higher rent prices. Renters pay $1,700 a month on average for a housing unit.
The most popular Jacksonville neighborhoods include Herlong, Bartram Springs, Chimney Lakes and Settlers Landing. Their popularity is due to the high demand for rentals.
It costs about $153.31 to rent a 10 by 10 non-climate-controlled storage unit. But the prices depend on the unit size, amenities and location.
How Jacksonville Compares to Other Cities
Cleveland, Ohio, currently has a home price appreciation rate of 3.2 percent per year. It is less competitive than Jacksonville, FL, where the home price appreciation rate per year is 4.6 percent. These estimates focus on an initial investment of $250,000 in both cities,
The city of Jacksonville boasts relatively higher rents and low home prices compared to Cleveland. As such, it favors investors looking to gain positive cash flows from their investments.
Home appreciation is a phrase used to refer to the increase in the monetary value of a house. The higher the appreciation rate, the more likely the owner will make a profit after selling the property. A higher appreciation value can also earn the owner more rental income.
Investing long-term in Jacksonville’s real estate market can earn you higher returns. You also get to enjoy economic and tax incentives to safeguard your money.
In particular, based on the current home price appreciation rate, you can earn $11,500 per year on a $250,000 investment. If you hold it for 20 years, your returns will have a value of $364,573.
In comparison, Cleveland offers a low return on investment over a 20-year period. A $250,000 investment will give you $219,390.
What Affects Home Price Appreciation Rates in Jacksonville, FL?
Home price appreciation levels vary widely depending on the market cycle. If you measure them over several market cycles, they are relatively steady. As a result, they may give you great opportunities to earn more returns on your real estate investment.
In the case of Jacksonville, housing prices have grown at a rate of 4.6 percent yearly since 1982. The rate is about 25 percent more compared to other cash flow markets. These markets include Cleveland, Birmingham, Dallas, Memphis and Kansas City.
Population growth can affect the appreciation rate of home and rent prices. As such, the appreciation rates for home and rent prices increased as Jacksonville’s population grew over the years.
In particular, the Jacksonville Metro Area had a 1.35 percent population increase from 2019 to 2020. It is currently growing at a yearly rate of 0.44%.
The property’s location can also affect its appreciation value. Potential buyers usually look for desirable locations with improved infrastructure and amenities. Recent developments in Jacksonville’s real estate market are improving the desirability of living in this city.
As more companies continue to set up their operations in Jacksonville, the city invests in improving its public transport facilities. Improved infrastructure and transportation have a positive impact on home price appreciation
Economic Incentives Available for Real Estate Stakeholders
The Florida real estate market offers a favorable tax environment for individuals and businesses looking to invest in real estate. Florida also ranks among the top US states for doing business due to its less strict regulations. Other factors that make it competitive include zero state income tax, great schools and low labor costs.
Jacksonville’s local and state governments have attractive tax incentives for businesses. These incentives allow them to easily expand or move their operations to the city.
Tax Incentives Available in Jacksonville, FL
The Quick Response Training is one of the incentives you can tap into. It reimburses training expenses for a growing or new business. You can use it to cover materials, curriculum development or instructor wages when training your staff.
For an incentive that functions like a tax rebate, consider the REV Grant. Also known as the Tax Increment Economic Development Grant, this incentive reimburses business expansion activities. The local authorities base it on the percent of new property taxes a business earned from an expansion.
The Economic Development Transportation Fund also offers favorable awards. A company can earn a maximum of $3 million depending on the jobs or investment opportunities they create. But the opportunities need to help address transport problems in their area,
With the High Impact Performance Incentive Grant, you get an award for a high-impact facility. The grant helps grow and attract major high-impact companies in the Sunshine. You need approval from the Department of Economic Opportunity to qualify.
The Capital Investment Tax Credit offers a 20-year annual credit against your corporate income tax. You can use it to settle construction, project equipping or acquisition costs. But the project needs to have a minimum of $25 million as capital and the potential to create 100 employment opportunities.
Real estate stakeholders looking to enjoy these incentives need to seek help from JAXUSA Partnership for more information on these incentives. JAXUSA Partnership operates as a private but nonprofit wing of the JAX Chamber. JAX Chamber serves as the regional economic development initiative in Jacksonville.
Other Incentives That You Can Enjoy
Limited partnerships in Florida pay zero corporate income tax. The same incentive applies to subchapter S-corporations. Residents working in the Sunshine State’s cities, Jacksonville included, don’t pay any state personal income. They also enjoy zero corporate franchise tax on any capital stock they own.
If you want to own a residential property in Jacksonville, note that there’s no property tax assessed at the state level. The state government won’t also tax your business inventories. And if you have manufacturing equipment and machinery in operation, you won’t pay any sales tax.
Goods that are in transit for a maximum of 180 days qualify for the zero property tax incentive. Those produced or manufactured in the Sunshine State for outside-the-state export also enjoy zero use and sales tax.
Companies don’t incur any use or sales tax for co-generating electricity. There are also no sales taxes on raw materials bought for a product meant for resale. These raw materials include non-reusable packaging or containers.
Top Jacksonville Neighborhoods for Living and Investing
Jacksonville boasts several neighborhoods that favor individuals and businesses looking to buy or sell properties. Below, explore some of the top Jacksonville neighborhoods for both living and investing.
For investors, the favorable neighborhoods include Murray Hill, Avondale and Riverside. Here’s a detailed review of each.
With close proximity to the St. Johns River, Riverside is one of the oldest Jacksonville neighborhoods. It is also among the trendiest places to live in the city.
Riverside boasts a diverse history and culture and a bohemian feel. Residents and visitors love it for the antique stores, nightlife, unique shopping experiences and cool cafes. The neighborhood also has a food and beer district for mouth-watering cuisines and tasty beers.
If you want to invest in the Jacksonville real estate market, you may want to consider Riverside for its great sense of community. Whether it is a vacation rental or a multi-family home, your investment opportunities are endless. Singles and families like this neighborhood for its great living standards, plentiful amenities and safety.
The median home price in Riverside is $256,000. For an Airbnb, the investment returns are about 1.49 percent and 2.36 percent for a traditional home.
Airbnb occupancy rates in the neighborhood are at 54.57 percent. So, expect an average of $978 as rental income for an Airbnb unit. Traditional units have an average rental income of $978.
2. Murray Hill
If you want to invest in a Jacksonville neighborhood with great returns in Airbnb and traditional housing units, consider Murray Hill. The neighborhood boasts close proximity to Jacksonville’s popular parks. These parks include Murray Hill Playground, Four Corners Park and Jasmine Park.
Murray Hill favors both retirees and young families. It also attracts tourists since it lies close to downtown Jacksonville.
Homes in Murray Hill have a median price of $147,400. The occupancy rate for Airbnb units is 43.62 percent, while their return and rental incomes are 2.37 percent and $804 per month. For a traditional housing unit, the return and rental incomes are 2.67 percent and $852, respectively.
Avondale and Riverdale neighbor each other. Residents tend to refer to them as an extended neighborhood.
Like Riverside, Avondale is full of amenities, parks, restaurants and elegant boutique ships. But the median home prices in Avondale are quite lower (S235,000). Due to the lower home prices, Airbnb users frequent this neighborhood.
The occupancy rate for Airbnb units is 57.3 percent. Airbnb units have an investment return, and the average rental income is 3.88 percent and $1,402 per month.
Traditional housing units have a return of 1.95 percent. They also bring in an average rental income of $1,020 per month.
The city of Jacksonville has several neighborhoods that favor individuals, families, and retirees. Whether you are looking for a beach house or condo in the city, below are some of best neighborhoods to consider.
1. San Marco
As a colorful neighborhood known to resemble Italy’s Piazza San Marco, San Marco is a great place for families and retirees. It features plenty of independent bookstores, trendy boutiques, consignment shops, and craft breweries. Besides having an artsy and youthful vibe, the neighborhood lies close to downtown Jacksonville.
You can explore the San Marco housing market for different types of homes. Popular options here include historic homes and condos.
For individuals and families looking for homes with a large yard, the Northside neighborhood is quite ideal. Homes in the neighborhood come with about one acre of lot size. There are also plenty of housing styles to choose from.
Options for home styles in Northside include Mediterranean villas, ranch-style homes, and townhouses. These properties lie in an environment that blends rural appeal with convenience. You can easily access them via car from downtown Jacksonville or the cruise terminal, train station, or airport nearby.
3. Ortega Forest
Though it is slightly expensive, Ortega Forest boasts big oak trees and riverfront mansions. It lies on the peninsula that serves as the meeting point for St. John’s and Ortega River.
In addition to having plenty of small parks, Ortega Forest is home to some of the popular restaurants in Jacksonville. It is also close to downtown Jacksonville (a 15-minute drive).
The housing market in Ortega mainly caters to wealthy individuals. A small section of it has a median home value that is more than two times the city’s median home value. On average, homes there go for $401,800.
What Does This Mean for Sellers and Buyers?
Jacksonville, FL, is a prime real estate investment destination. It offers plenty of opportunities for individuals, businesses, and families. There are also several neighborhoods that individuals and businesses can tap into when looking to buy or sell a home.
The city has great potential for new ground-up construction, fix and flip residential properties, and single-family rentals. As such, it ranks among the top lucrative real estate markets in the US for both buyers and sellers.
Since it is the biggest city in Florida as well as the continental US, it has great potential for people or businesses looking to invest in a city. And based on the market statistics covered in this guide, now is the perfect time to buy or sell properties in Jacksonville.
The attractive tax incentives and affordable housing prices make Jacksonville ideal for real estate investment. More individuals and businesses are relocating from other parts of the country to settle in this city. If you join other buyers or sellers in this market, you are likely to enjoy great returns on investment.
What the Future Holds for Jacksonville Real Estate
Home builders, investors, renters, and homeowners see a bright future for Jacksonville’s real estate market. So, expect large-scale housing expansions in the city’s suburbs. The city will also have a great supply of rental houses to cope with the increase in population.
Large corporations across the country and the world are also coming to Jacksonville to set up their businesses. Most of these investments focus on revitalizing downtown Jacksonville.
The population is likely to grow, increasing the need for housing units. As a result, investors will have more opportunities to make a profit.
Looking to Invest in the Jacksonville Real Estate Market?
The Jacksonville real estate market offers promising opportunities to both buyers and sellers. It continues to change Florida’s real estate sector while also playing an important part in the state’s economy. With this information, you can decide whether investing in real estate in Jacksonville is a good idea.
And if you want to sell for cash your residential property in Jacksonville, FL, count on Jax Home Offer for a fair all-cash offer. We will buy your property whether in as-is condition. Get a fast cash offer today!