I’m a Financial Planner: These Are the 3 Most Overpriced Retirement Towns in Florida
Written by
Angela Mae Watson
Edited by
Amber Barkley
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With an average of 237 days of sunshine every year, seemingly endless beaches, plenty of amenities and no personal income tax, it’s no surprise that Florida continues to attract retirees from all over the country.
According to Statista, Florida has the second highest number of retirees out of all states — second only to California — with nearly 4.6 million of its residents ages 65 and up. That’s roughly 20% of the state’s overall population.
But while Florida has a lot to offer, the cost of living has become a concern for many soon-to-be and current retirees. Some parts of the state, especially certain retirement hot spots, have become overpriced, making it harder for those living on a fixed income to afford to live there.
GOBankingRates spoke with Rob Macoviak, a financial advisor and the president of Oyer, Macoviak and Associates, an insurance office in Boynton Beach, Florida, to find out which retirement towns he thinks are the most overpriced in the Sunshine State.
Most Overpriced Florida Towns
“As a financial advisor in Florida for over 15 years, I’ve seen many retirement towns become overpriced over time,” said Macoviak. “Some of the most egregious in my experience are Naples, Sarasota and Palm Beach.”
Here are some key figures for each of these retirement towns, so retirees have a better idea of what to expect when living there.
Naples
- Typical home price: $595,693 (1.4% increase over the past year)
- Typical rental price: $2,369
- Grocery prices: 117% above the national average
- Average cost of homeowners insurance: $2,502 per year (up about 35% over the past two years)
- Sales taxes: 6% sales tax (no local/county sales tax)
- Effective property tax rate: 1.2% (slightly higher than the national average of 1.11%)
- Overall cost of living: 13% higher than the U.S. average and 9.6% higher than the state average
- Minimum recommended annual income per person: $62,000
Naples makes the list of most overpriced retirement towns in Florida for several reasons. According to Macoviak, the high cost of homes is just part of it. Property taxes, rental costs — for those who go that route — and the overall cost of living is also higher than the national and even state average.
In Naples, retirees can expect to spend more than the state average on groceries, healthcare, housing and miscellaneous costs. Only transportation and utilities are cheaper.
Sarasota
- Typical home price: $457,900 (0.1% decrease over the past year)
- Typical rental price: $2,113
- Grocery prices: 5.3% above the national average
- Sales tax: 7% (including 1% local sales tax)
- Effective property tax rate: 0.98% (lower than the national average)
- Overall cost of living: 5.3% higher than the U.S. average and 2.1% higher than the state average
- Minimum recommended annual income per person: $81,120
Like Naples, Sarasota’s cost of living is higher than many other parts of the state and country. For retirees who are thinking about selling their current property and buying a new one, local home prices are a big consideration.
While the average home price is over $450,000, Macoviak said that even a retirement condo can easily cost $350,000 or more. When you tack on property taxes, homeowners insurance, maintenance and other expenses — related and not related to homeownership — this retirement hot spot can quickly feel overpriced.
Palm Beach
- Typical home price: $2,125,639 (3.8% increase over the past year)
- Typical rental price: Upwards of $2,000
- Sales tax: 7%
- Effective property tax rate: 1.11%
- Overall cost of living: 14.1% higher than the U.S. average and 10.7% higher than the state average
- Minimum recommended annual income per person: $74,000
“Palm Beach, especially near Mar-a-Lago, is essentially unattainable for most retirees,” said Macoviak. Even lower-priced homes are still above $1 million.
Palm Beach does have a strong economy, but this won’t be as beneficial for retirees — excepting those who still choose to work part-time.
Key Statistics About Living in Florida
Here are some key statistics for those wanting to retire in Florida — according to BestPlaces, Zillow, Aston Gardens and Tax Foundation:
- Overall cost of living: 3.1% higher than the national average
- Per capita personal income: $68,248
- Average home price: $398,077
- Average cost of long-term care: $44,400 for an assisted living facility to $117,000 or more for a private nursing home room annually
- Cost of healthcare/Medicare: $148 to $504 per month
- Retirement income taxes: Between 12% and 24% in some cases
- Sales tax: 6% to 8%
- Effective property tax rate: 0.71%
Other Costs To Consider When Retiring in Florida
Retirement comes with its share of costs, so it’s best to be prepared — no matter where you choose to live.
“The main costs to consider are housing, healthcare and taxes,” said Macoviak. “Property taxes and homeowner’s insurance in Florida are high compared to other states. Healthcare costs are also higher than average here.”
Macoviak suggested looking for a town where the effective property tax rate is well under 2% and the sales tax rate is low. “Also, look at the quality and availability of healthcare facilities — you’ll want good doctors and hospitals nearby in your retirement,” he added.
Be sure to factor in your lifestyle choices and needs when calculating your overall costs, too. Things like entertainment and dining out can be extra pricey in places like Sarasota, Naples and Palm Beach.
“Some towns have become such ‘destinations’ that restaurants and activities have increased prices tremendously,” Macoviak said. “Do some research on the towns you’re interested in to make sure you’ll be able to afford not just the necessities but also enjoyment of life during retirement. A lower-key town with naturally beautiful surroundings may end up being more budget-friendly.”
Average home prices were sourced from Zillow. Average rental prices were sourced from RentCafe. Cost of living and recommended annual income were sourced from BestPlaces.
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