Thursday, August 21, 2014
Housing starts in Southwest Florida spiked sharply in the second quarter, according to a report issued Wednesday by housing data provider Metrostudy.
Overall, starts in Lee and Collier counties increased 11.4 percent from 778 single-family homes in the first quarter to 867 in the second, according to Metrostudy, which tracks new-home construction in subdivisions in the Fort Myers-Naples area and other markets around the country.
Also, Collier has almost caught up with its larger neighbor Lee, accounting for almost half of the starts so far this year, said David Cobb, Metrostudy's regional director in the Naples-Fort Myers area.
The strong showing in Southwest Florida was part of a pattern in which "some of the most 'beaten-down' markets are now doing better," Brad Hunter, chief economist and director of consulting for Palm Beach Gardens-based Metrostudy, said in a written release.
Tim Rose, president of Fort Myers-based Arthur Rutenberg Homes, said he thinks whether the good news continues depends to some extent on national factors.
"Stability is always something that makes my customers happy," he said. "We look for stability in the marketplace, the country, the world. That's what makes people comfortable."
He's hiring more staff to deal with the increased sales volume, Rose said, "and I think other people are looking at that too."
Land Solutions CEO Randy Thibaut, who specializes in brokering the large-scale land transactions necessary to create residential communities, said the second-quarter numbers are encouraging but that it's important to watch for possible obstacles to future increases.
"We do have some slowdowns in the sales centers," he said. "We do have some standing inventory that's building. My biggest concern is oversupply. Are we going to oversupply? It's something we should keep a very close eye on."
Thibaut also said it's important to remember that the current pace of new-home construction is still a shadow of what it was before the housing boom collapsed in late 2005.
"By year's end we're only going to get around 8,500 single-family permits for Lee, Charlotte and Collier counties," he said. "That's far from the 45,000 we had at the peak (2005); it's far from the 10,000 we had in the year 2000."
Cobb said that there's a possibility of an oversupply of inventory, but that it wouldn't last long.
"In the short term there might be a little too much home-building activity in the market," he said, but the supply of land is tight and increasingly expensive in Collier while in Lee, supply is tight in desirable areas.
"The biggest problem is where people want to build: Estero, Bonita and to a certain extent the Treeline area," Cobb said. "Most of what's left is either in Lehigh Acres or Fort Myers."
Thursday, August 14, 2014
Home buyers in Cape Coral-Fort Myers are second in the country in paying cash — stimulating the local real estate industry but creating potential dangers ahead.
The Cape Coral-Fort Myers metro area had 64 percent all-cash home purchases in May, according to a report released today by Irvine, Calif.-based financial data provider CoreLogic.
Florida was the No. 1 cash purchase state with 53.4 percent.
All that cash is flowing into the area because of the newly strict oversight by federal regulators of bank loans, plus low interest rates that make it unattractive to simply leave large amounts of money in a bond or a certificate of deposit, said Brett Ellis, head of The Ellis Team with Remax Realty Group in Fort Myers.
"It's easier to get a loan than it was two years ago," he said. "But there are additional restrictions they're putting on. A lot of buyers have the money, they think Florida's a good value but they don't want to jump through all those hoops."
Also, Ellis said, "A lot of people think there's going to be a stock market correction, so real estate seems to be the place to park your money."
One consequence of all this is that it's the more expensive homes that tend to be purchased with cash, he said — lower-end buyers have to take their chances with the bank loan process.
But interest rates likely will start rising in a year or two and that could be a game changer, said Bob Knight, co-owner of Cape-based Paul Homes.
The home-building industry in Southwest Florida has been trending stronger recently, but still isn't in shape to deal with a serious hit such as a sharp increase in interest rates, he said.
Higher interest rates, Knight said, could prevent some people from buying a house altogether while even those with the ready cash could decide to keep their money in the bank.
That could cause trouble for the slowly improving housing market here, he said.
"We're in recovery mode," Knight said. "We're not recovered yet. It's a fragile recovery headed in the right direction."
Tuesday, August 12, 2014
South Florida home prices rising more slowly
BY MARTHA BRANNIGAN
South Florida’s red hot housing market continued to cool in the second quarter.
The median price of a single-family home in the metropolitan area comprising Miami, Miami Beach and Fort Lauderdale rose 7.6 percent in the second quarter to $270,000 from a year earlier, according to the National Association of Realtors.
Despite the slowdown from double-digit price spikes a year earlier, South Florida median home prices continued rising at a faster pace than national prices.
The national median existing single-family home price rose 4.4 percent in the second quarter to $212,400 from $203,400 a year earlier, NAR said. That was far slower than the 8.3 percent year-over-year increase in the median price in the first quarter.
“National median home prices began their most recent rise during the first quarter of 2012 but had climbed to unsustainable levels given the current pace of inflation and wage growth,” NAR chief economist Lawrence Yun said in a statement. “At this slower but healthier rate, homeowners can continue steadily building equity. Meanwhile, for buyers, increased supply with moderate price gains is giving them better opportunities to choose.”
Read more here: http://www.miamiherald.com/2014/08/12/4285321/south-florida-home-prices-rising.html#storylink=cpy