Real Estate Monday: The Cost of Paradise

Still a value, but rising in cost.

Paradise comes with a price.
After years of being known as a relatively inexpensive place to live, Florida is beginning to gain ground on feeder states like New York, but still has a long to go before it’s as expensive as California, the D.C. area, Hawaii and the Empire State.
Overall, it costs less to live in 33 states other than in Florida based on the latest analysis from the U.S. Department of Commerce. Snowbird states like Michigan, Ohio, Indiana and Pennsylvania all rank as more affordable.
Florida tied with Oregon as 16th on the department’s affordability index, released Thursday in tandem with new personal income data. The new comparison tool, dubbed Regional Price Parities, measure the state-by-state differences in the price levels in a given year for goods and services such as food, energy and housing.
“For the first time, Americans looking to move or take a job anywhere in the country can compare inflation-adjusted incomes across states and metropolitan areas to better understand how their personal income may be affected by a job change or move,” U.S. Secretary of Commerce Penny Pritzker said in a statement. “Businesses considering relocating or establishing new plants also now have a comprehensive and consistent measure of differences in the cost of living and the purchasing power of consumers nationwide.”
The index expresses costs in an area as a percentage of the overall national price level for each year, which is set at 100.
The most expensive locale, Washington, D.C., had an index rating of 118.2; the least expensive state, Mississippi, stood at 86.4. Florida came in just under the national baseline at 98.8.
Hawaii was second most expensive state followed by New York. The bottom three were Mississippi, Arkansas and Alabama, a popular retirement spot for Florida public pensioners.
Other high cost states were New Jersey, California, Maryland, Connecticut and Massachusetts.

Just below Florida in cost of living are a few states that compete with the Sunshine State for retirees, second home buyers and others: they are Arizona (98.1), Texas (96.5), Georgia (92) and North Carolina (91.6).
“People are beginning to recognize that Florida has the best weather in the country, an improving school system and top flight universities,” says one local realtor. “There’s also lots of culture and great health care and that adds up to rising cost of living. It’s not politically correct to say it, but clients who think that we are going back to the old bargain Florida are just fantasizing. This is now a world class destination and the price tags are going to reflect that.”