Entries Tagged 'South' ↓

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The recovery efforts for the gulf coast region after the devestation by Hurricane Katrina are being hampered by the lack of low cost housing units available. Most of those who lived in lower end housing in the gulf region have found it hard to rebuild and easier to relocate to another part of the country.

The House of Representatives are looking to extend housing subsidies to encourage the development of low cost housing in the gulf region to entice builders to rebuild low end housing. Now the trick will be to see if those people will move back.

I know that in Atlanta, we absorbed many families displaced by the hurricanes and most of them have now integrated into the community and have no plans to move back anytime soon. The lack of economic opportunities compared to a vibrant city like Atlanta make the return much harder to do.

The tax provisions are scheduled to expire at the end of 2008, a date that Reps. John Lewis, D-Ga., and Jim Ramstad, R-Minn., said won’t provide enough time to develop the housing needed to replace the tens of thousands of units destroyed or severely damaged by Hurricanes Katrina and Rita in 2005.

“We need to make some tax-law adjustments in order to start the hammers pounding and get the bricks and mortar laid,” said Lewis, chairman of the Subcommittee on Oversight for the Ways and Means Committee.

The shortage of low- and moderate-income housing threatens the recovery of New Orleans and other Gulf Coast communities, said Ramstad, the panel’s ranking Republican. “This is simply unacceptable. This is wrong and must be corrected as soon as possible,” he said. via the Times Picayune.

State Farm has gotten approval from the state insurance regulators to raise the policy premiums 50 percent in Florida. The scary part is that State Farm was asking for a 79 percent increase and had to settle for the 50 percent bump. The rates will effect new and current customers.

The rates, more than a $1,000 increase on a $2,000 premium, are effective Aug. 15 for new customers and Nov. 15 on renewals. State Farm Florida first sought an average 79 percent increase when it asked for higher rates in May, but the company withdrew that request earlier this month.

State Farm officials have said they sought the rate increase to enable the company to continue to underwrite coverage in the state. Other companies also have sought rate increases.

Allstate Floridian has pursued a different strategy, dropping Florida customers to reduce its risk from hurricane damage. Allstate has plans to drop 350,000 home policies. In March, the company had 529,000 Florida homeowners’ policies.

Nationwide has a pending request to increase rates by 71 percent on the 261,000 policies it has in Florida. via The Quad-City Times Newspaper

As with anything in this world, the new KIA Plant in West Point, Georgia that we have followed so closely has been approved by the state, but some local residents are unhappy with the new plant being placed in their neighborhood. I can understand as living in a rural area is important to folks, and their quiet location will be disturbed.

However, this is not going to change the outcome, and the folks there will most likely get fair market or higher for their homes as other homeowners or developers will want to purchase the property to provide housing and commercial opportunities to the community as it grows.

A standing-room-only crowd packed the Gray Hill Community Center Friday evening seeking answers to questions that have arisen since Kia’s March 13 announcement to build a $1.2 billion automobile manufacturing and assembly center on Webb Road near I-85.

Commission Chairman Tim Duffey and Commissioner Ken Smith fielded questions ranging from whether property taxes would be going up for Gray Hill residents, to where the new interchange would be built on the Interstate, whether they could be annexed by the city of West Point and even if new development could cause their wells to run dry.
Almost everyone there shared a common concern that the way of life they’d known for a long time was about to change and to change in a big way.
Gabbettville Road resident Jim Gilmore said that the Kia announcement had been widely treated as good news but that there was another side to that story and “We haven’t been heard from yet.”
Gilmore said he’d left such crowded places as Houston and Atlanta in search of a place that offered the nice, quiet way of life that can be found in the Gabbettville community today. With the Kia plant coming that way of living is going to change. In search of what those changes could be, Gilmore said he’d gotten on the phone and called the Georgia Department of Transportation in Atlanta. He said that the people he talked to had been very nice and did their best to answer the questions he asked. via the Valley Times.

The housing market in Florida is slumping as the speculative element  is getting out and buyers remain wary as they wait to see what will happen. Tampa Bay saw a 29 percent decrease in volume with a 1 percent price increase. This tells me that sellers are holding firm on pricing while buyers are showing patience. The marketplace will stagnate or decline until a foundation is set.

While some are very upset, this is just the markets at work and make capitalism such a great economic system. We will have periods of passion and despair in short term periods, but over the long term, the  market will find a consistent trend.

This mirrors the statewide trend, which saw a 20 percent drop in homes sold, to 13,539 from 16,916 in February 2005. Rising inventory levels and still-low mortgage rates are contributing to better balance the marketplace, FAR said in a release.
Realtors from across the state report that the supply of homes available for sale in their markets is improving, offering buyers more housing opportunities. The statewide median price for single-family existing homes last month was $244,200, up 24 percent from the February 2005’s statewide median of $197,700. In Tampa Bay, home prices inched up 1 percent, to $222,200 in February, from $216,700 in January. But that represents a 27 percent increase over the same period last year via Tampa Bay Business Journal.

The Orlando Sentinel has a great wrap up of the significant real estate revenue for the major companies doing business in Orlando. Here are some excerpts:

• Realty Capital of Orlando posted $109 million in deals last year, up from $80.5 million in 2004. Sales, leasing and management activity all soared in double digits.
• Signature GMAC Real Estate posted $400 million in sales last year and a record $12.5 million in gross commission income, according to general manager Lisa Gould.
• D.R. Horton Homes sold 2,412 houses last year in the Orlando area with the average sale at $240,000.
• Nicholson Homes had more than $100 million in sales last year in six area communities.
• Royal Palm Homes sold more than $88 million in homes, lots, condos and town homes in 2005.
• The condominium sales division of Signature GMAC Real Estate posted more than $11 million in pre-construction sales at Urbana, a 236-unit condo at Hunter’s Creek in south Orange County.
• Lake Forest Realty in north Seminole County had more than $90 million in sales last year, up more than 20 percent from 2004. via OrlandoSentinel.com

It will be interesting to see the numbers for 2006 and see how they line up. If the Bubble Bloggers are correct, there should be significant downward pressure on these numbers.

In the battle to get the billion dollar Kia Automotive Plant that is planned to be built in the Southeast United States, Lowndes County  in Mississippi is preparing to offer KIA a 23 million dollar incentive package. West Point, Georgia is the leading candidate for having the KIA plant  built, but it  is obvious that such a large investment of jobs and infrastructure is attracting a good deal of competition.

Lowndes County, Mississippi, supervisors say they will discuss a proposal to pledge 23 million dollars to an effort to entice an automaker to its region.The proposal is on the board of supervisors agenda today.Last spring, supervisors agreed to issue up to 22 million dollars in general obligation bonds to buy the first megasite for SeverCorr and to help Baldor Electric and Aurora Flight Sciences with construction needs.The SeverCorr mill will produce high-grade steel for the automotive industry.But only 12 of the 22 million dollars was used.

The supervisors will consider adding 13 million to the remaining ten (m) million for a total of 23 million dollars.The money would be repaid through the eventual lease of the property. It would buy the one-thousand-958-acre Crossroads site west of Golden Triangle Regional Airport and make initial site preparations and infrastructure improvements.via the AP Wire

The Atlanta City Council Zoning Committee has more sense than the mayor, as they recognized that by not allowing certain areas of the city to have much more restrictive zoning than others, they were creating an unfair disadvantage for some. With this they shut down Shirley
Franklin’s McMansion Moratorium that precluded builders from performing tear downs in  parts of the city. 

The Atlanta City Council’s zoning committee has voted down a four-month moratorium that would have prohibited the builders of so-called McMansions from getting demolition permits to destroy the old houses they hoped to replace.
The existing temporary ban, ordered by Mayor Shirley Franklin, ends Monday. The extension would have covered selected Atlanta neighborhoods such as Virginia-Highland and Midtown.
It would have prohibited builders from getting permits to demolish houses if they planned to rebuild on a grade five feet higher than it was or to construct a house more than 35 feet high.
The four council members who voted down the moratorium yesterday said they did so because it was too exclusive. It would have covered less than five percent of the city.
Councilwoman Natalyn Archibong says she would NOT support legislation that sends the message some parts of Atlanta are more valuable than others.via WSBTV.com

The Grand Strand, which is the coastal region of South Carolina surrounding Myrtle Beach, showed a strong increase in sales in 2005. This accompanied a strong increase of throughout the state of South Carolina which showed sales increases of  23% in volume and average price per home increased by 9.6% year over year.

Along the Grand Strand, home sales jumped 35 percent and median prices rose 25 percent to $172,000. Home appreciation in the Grand Strand - the area from Georgetown to North Myrtle Beach to Conway - was the highest reported statewide in the past 12 years, Peters said..via Myrtle Beach Online.

 

Got to love the optimists… PNC did this survey of 200 wealthy South Floridians, and heard a level of optimism not heard much these days.

We believe that South Florida real estate remains a good investment,” said Robert Saltarelli, regional president of PNC Advisors in Naples. “Depending upon the individual client’s income and liquidity needs, we believe that a portfolio with 20-25 percent invested in real estate in this region is appropriate and should continue to deliver solid returns.”

Highlights of the real estate findings in Florida include: - Nearly three quarters of Floridians surveyed said they expect to see double-digit increases in the value of their primary homes over the next five years. - Just one in 20 wealthy South Floridians (5 percent) expects any decline in the value of their primary homes over the next five years. - Just one in five South Floridians say they got rich through real estate, but those who did are twice as likely to expect their real estate values to continue to increase. Nearly nine in 10 (89 percent) who say residential real estate is a major source of their wealth are expecting double-digit increases over the next five years, and 81 percent are expecting an increase of 20 percent or more, compared with 42 percent nationally. - Four in 10 (39 percent) South Floridians surveyed said that a major decline in housing prices would pose no threat to their family’s wealth. One in five (19 percent) said it would pose a threat. via Finanzan.net

Is this an indicator of “only so much waterfront”, realistic expectations, or groupthink?

Dean Foust from over at Business Week (b)logs in on the topic. He and I see eye to eye on the short term projections, and disagree on the long term.

What do I think? I think there’s a parallel to what happened in stocks. Not predicting a nationwide 30% downturn, but perhaps a 10% to 20% downturn in overheated markets, followed by a long stretch–perhaps a decade or more–of flat returns. I think there’s a good chance that come 2015, Americans will be so conditioned to earning NOTHING on their home that the days when housing was viewed as an “investment” will seem quaint.

 

You have to wonder about taking ones house without your approval to build a massive development by force. Riviera Beach government is in the process of relocating 6,000 residents to develop a 400 acre site. Yes they will be paid, but not to the level they could command on the open market. So essentially Eminent Domain is being used to take their property by the point of a gun.

The Palm Beach Post has a looked at the study that determined Urban Blight and found that there are some serious inconsistencies with the methodology.

The city’s blight study reported that the north side of a 10th Street block was vacant. It wasn’t. Four- and five-year-old homes dotted the street.

• Where some homes had double lots, the second lot was listed as vacant, inflating the number of unused properties.

• Homes in good condition were classified as dilapidated and beyond repair.

• Hundreds of mobile homes, including some that later weathered Hurricanes Frances, Jeanne and Wilma, automatically were classified as blighted due to undocumented safety problems or criticism such as “a tendency to blow over in storms.”

• There were no findings of high crime rates or fires, a key justification of blight. City computers were being tweaked to accommodate a new system, according to the city’s study, and so the numbers could not be retrieved.

• Buildings in good shape were declared “functionally obsolete,” defined generally as a structure which, if torn down, could be replaced with something that generated more money.

Boston Globe

The goal, Mayor Michael D. Brown said during a public meeting in September, is to ”forever change the landscape” in this municipality of about 32,500. The $1 billion plan, local leaders have said, should generate jobs and haul Riviera Beach’s economy out of the doldrums.

Opponents, however, call the plan a government-sanctioned land grab that benefits private developers and the wealthy.

”What they mean is that the view I have is too good for me and should go to some millionaire,” said Martha Babson, 60, a house painter who lives near the Intracoastal Waterway.

”This is a reverse Robin Hood,” said state Representative Ronald L. Greenstein, meaning the poor in Riviera Beach would be robbed to benefit the rich.