What it’s like to sell a luxury home in the Upper Keys

The Keys recently enjoyed a rise in luxury sales volume, with South Florida’s second-home buyers closing most of the deals

94100 Overseas Highway in Tavernier is listed for $24.5 million.
94100 Overseas Highway in Tavernier is listed for $24.5 million.

Made famous in movies and TV shows like the Humphrey Bogart and Lauren Bacall classic “Key Largo” and the Netflix thriller “Bloodline,” the Florida Keys cater to homebuyers who want to escape South Florida’s hectic lifestyle and boat, fish or dive — or simply chill.

Coldwell Banker Schmitt Real Estate’s Brian Schmitt, who has been a broker in the Keys since 1983, said out-of-town buyers continue to flock to the Upper Keys, those closest to Miami — Key Largo, Tavernier and Islamorada — in search of a relaxing, laid-back retreat.

“It’s the color and the quality of the water and what you can do on the water that is attractive to people,” said Schmitt, whose firm, the largest in the Upper Keys, became a Coldwell Banker franchise in 1986.

During the 12 months ending in January, 134 homes priced over $1 million traded in the Upper Keys, excluding Ocean Reef Club. That’s up 25 percent from 107 during the previous 12-month period, according to data from the Multiple Listing Service, compiled by Coldwell Banker Schmitt Real Estate. The average price was $1.615 million, down from $1.815 million, yet total dollar volume rose 11 percent due to the rise in the number of sales. Homes sold for an average of 15 percent less than their original list price.

“There’s more demand based on the number of sales transactions, but sellers are having to reduce their prices to a greater degree to attract a buyer and do a deal,” said Schmitt, who has five offices throughout the Keys, including two in the Upper Keys — in Key Largo and Islamorada.

Meanwhile, luxury inventory is dropping. At the end of January, there were 213 residential properties priced over $1 million for sale in the Upper Keys, versus 240 a year earlier, Schmitt’s data shows.

That’s a healthy sign for the market, brokers say. “There was a pickup in activity, new construction came on the market, and that sold rather quickly,” said Joy Martin, owner and broker of American Caribbean Real Estate.

While the market will no doubt feel some impact from recent upheaval in the stock market, the peak selling season in the Keys is traditionally December through April, as well as July and August, said Martin, whose firm has 35 agents and two offices in Key Largo and Islamorada.

The competition

In all, more than a dozen brokerages compete for listings and sales in the Upper Keys.

“It’s collegial, but it’s still fierce,” said Schmitt, who has 115 active agents and 15 staff. About 1,250 agents vie for about 2,800 transactions annually in all of the Florida Keys, he said.

According to a 2019 market-share ranking by Schmitt’s firm, using Multiple Listing Service data, Coldwell Banker Schmitt held the top spot in the Upper Keys with 314 sales or 16.1 percent of the market. Next was American Caribbean with 202 sales or 10.3 percent market share, followed by Ocean Sotheby’s International Realty with 134 sales or 6.9 percent.

Owned by Russell Post for 10 years, Ocean Sotheby’s International Realty has offices in Islamorada, Marathon and Key West, with a total of 40 agents, including 12 at his office in Islamorada. “The market has been good in the Upper Keys, a steady market over the last three years,” he said.

Broker John Gallant, who previously owned Blue 9 Realty and recently became a license partner of Engel & Völkers Islamorada, said that with a relatively smaller pool of agents in the Upper Keys, the competition is “a lot less cutthroat and more collaborative than in Miami or Fort Lauderdale.”

“Here, if you’re not professional and at least not polite and courteous, you will have a reputation that will run you out on a rail,” he said.

Key buyers

Sign Up for the undefined Newsletter

South Florida buyers rank as the top source for luxury vacation home purchases in the Upper Keys. After that come buyers from states along the Atlantic seaboard, New England and Midwestern states that border the Great Lakes, Schmitt said.

Though waterfront Keys properties compete as vacation homes with luxury second homes and condos in Miami Beach and other South Florida areas, the buyers are vastly different.

In the laid-back Keys, the main activities are diving, fishing and drinking, Gallant said.

“It’s not an area that is super attractive to people who don’t share that interest,” he said. And he sees an inverse relationship between what you have and how you dress. “If you see someone who looks borderline homeless, that guy has millions.”

South Florida developers Sergio Rok, Scott Robins and Michael Swerdlow are among those who have long treasured the Upper Keys for second or third homes.

“It’s tranquility. It’s truly getting away from city life,” said Rok, whose father, real estate investor Natan Rok, bought the family’s Islamorada compound in 1987.

Robins and his wife, Deborah, have owned an oceanfront estate on Plantation Key, one of the islands making up Islamorada, for 20 years. Spanning about 2 acres, the property includes a four-bedroom home, tennis court, pool, beach and 300-foot dock where Robins keeps his 35-foot-high fishing boat.

Swerdlow, too, remains a fan of the region, though five years ago he sold his oceanfront estate and private marina in Islamorada. The property holds the record for the priciest sale ever in the Upper Keys, closing for $13.125 million in 2015.

“When I had the house, I would spend 100 days a year there because of the fishing,” Swerdlow said, adding that he holds the record for the largest bonefish ever caught in the United States on a fly rod. It was 15 pounds, 8 ounces.

Price check on the Isles

The priciest home on the market today in the Upper Keys, by far, is the 13-acre bayfront estate at 94100 Overseas Highway in Tavernier, listed for $24.5 million. Compass agents Audrey Ross and Arline Tarte have the listing.

Sales at the higher end of the market have been slow in the past year. Only one residential sale closed at over $5 million in the Upper Keys last year, after 353 days on the market.

According to Martin, “2019 for luxury for us didn’t have the same momentum as previously.”

Brokers wonder what the future holds. For now, the effects of coronavirus on the market remain to be seen.

Schmitt said some buyers are probably being more cautious about making large investments because of the volatility of the financial markets. Yet others may want to take advantage of the lowest interest rates in 50 years.

“When you see something that has some sort of global impact, every market could have a trickle-down effect,” Martin said. “We’re watching it very closely.”