Central Florida Housing Starts Moving in Positive Direction
Housing starts in Brevard and Volusia counties in 2008 will be down significantly from 2003, according to data released by the University of Central Florida. While the Orlando Sentinel describes these numbers as "bleak," this is actually good news for anyone hoping to see some semblance of equilibrium in housing supply and demand. And of course we should anticipate double-digit declines this year compared to 2003, the year when most homebuilders were breaking ground on any lot that a.) would hold still and b.) did not already have a house built on it. The housing start figures for the four-county Orlando metro area are equally encouraging: 13,062 units this year compared to 28,075 in 2003.
Although hardly "breaking news," Reuters takes a closer look at the housing markets in Miami, Fort Lauderdale and Palm Beach and concludes that the once-resilient luxury home market is starting to weaken. The focus is a recent property auction in Fort Lauderdale where several properties were pulled due to low or no bids. The drama unfolded like this: On one high-rise condo in the Miami enclave of Williams Island, a 3,100 square foot penthouse previously listed at $5.6 million, he opened bidding at $5 million, lowered his price to $3.5 million, $3 million, $2.5 million, and then closed the auction, all within a minute. It's worth noting that some event attendees made a killing, including one guy who snatched up two Venetian Island bayfront homes for a combined $1.5 million. (The two were previously listed in 2005 for a combined $4.75 million.)
Well it was PNC Financial last week and this week it's BofA blaming Florida in part for lower-than-expected quarterly earnings. According to Bloomberg, "first-quarter net income declined 77 percent to $1.21 billion from $5.26 billion a year earlier." Revenue and net income fell in several categories including home equity and construction loans. Not helping matters was the fact that 44 percent of the bank's home-equity loans are in California, Nevada, Arizona and Florida, where housing prices by most accounts are moving in a non-northerly direction. BofA CEO Ken Lewis is probably sweating the bank's two worst quarters since 2001 and, judging by the look of construction loan consternation on his face above, Ken needs a hug. 
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