There’s the good news and the bad news in the housing market here in northeast Florida. Jacksonville’s housing market is projected to improve ahead of almost all other markets in the state of Florida (except for two, reportedly). The bad news is industry experts are predicting Jacksonville area home prices won’t return to their former peak levels (the peak prices formerly hit in 2006) for about another ten years — that is, 2020.
Hitting the price “trough” in the Jacksonville area is projected to take place during second quarter of 2011, so about another year. Fiserv estimates Jacksonville area housing prices will have dropped around 39% at the trough from the peak prices of 2006. But, it could be a lot worse — Florida-wise, that is.
Looking at the glass half full instead of empty, the Jacksonville area residential real estate market will return to better health in advance of most other cities in the Sunshine State, or so predicts the folks at Fiserv. (For those unfamiliar, Amelia Island, located in Nassau County, Florida, north of Jacksonville, is part of the Jacksonville MSA — Metropolitan Statistical Area).
Here’s a real shocker. Orlando (home to Mickey Mouse), Naples (known to attract some of the wealthiest residents in the state), and Miami (gateway to the Everglades and home to trendy hot spot, South Beach), are not predicted to return to their former housing price peaks until 2039. Gasp! Not for about three decades! Now that is an eye opener (perhaps a black eye).
The name “Fiserv” may not ring a bell for some, but they have clout in the industry. Fiserv reports home price historical trend data and forecasts for more than 375 U.S. markets based on the Fiserv(R) Case-Shiller Indexes(R), which is owned and generated by Fiserv, data from the Federal Housing Finance Agency (FHFA) and Moody’s Economy.
Fiserv, Inc. (NASDAQ: FISV) is the leading global provider of information management and electronic commerce systems for the financial services industry, and reportedly ranked No. 1 on the FinTech 100 survey of top technology partners to the financial services industry. For more information, visit www.fiserv.com.
But here’s a bit of good news on the local island scene. It appears some people are starting to spend money on both home improvements and new home construction. After what seemed to be a long lull, a time when it appeared not much was going on in the way of new homes being built or home additions and improvements, activity seems to be reviving a bit here on this barrier island. This is my personal observation along a frequently traveled route here on Amelia Island — just a small area of about a mile or so covering several neighborhoods by the beach.
The smell of freshly cut lumber has been in the air. Two big, new homes are being built on the outskirts of the Seaside community around Jean LaFitte Blvd — not far from the Fernandina Beach Rec Center. Just a few houses north of the Jasmine beach access on South Fletcher Avenue, another new home is under construction — oceanfront right on the beach. (The photo at the top of this article, however, is yet another new home being built right on the beach currently further north — North Fletcher Avenue — on Amelia Island.)
Plus, I’ve seen some major home improvement projects these past few months. New in-ground swimming pools with their screened enclosures being installed. An addition above a garage adding a sizeable new room (Ocean Cay). A rear lanai being closed in with walls to create a permanent room (Beach Walk). Another home (Ocean View Estates) with a lot of the “guts” removed — some major remodeling inside plus a new in-ground pool. New exterior siding. Some of these home improvement sites have had construction crews there for a few months — not small jobs. It’s notable activity after the “quiet time.”
You have to wonder why anyone would build a new home these days, though, with plenty of existing home inventory to choose from. Besides the “traditional” sales, there’s the REO (bank owned) homes and foreclosures still waiting to be absorbed. It’s stressful to build a new home — anyone who’s been through the process can attest to that. (Not that trying to acquire a foreclosure, short sale, or REO isn’t a stressful process — quite to the contrary from what I’ve heard.) But I can only imagine someone still builds new in the current environment because they already owned the property/lot or they really wanted a custom home designed just for them, regardless whether the cost is more per square foot than what they could buy in the way of a resale “existing” home.
Amelia Islanders and visitors here the past two weeks have enjoyed the best weather of the year. April has always been one of my favorite months here (the other being October.) Spring flowers are blooming adding dabs of color to the coastal landscape. Deep blue skies, gentle sea breezes, temps from the mid 70s to the mid 80s. We certainly have a lot to be thankful for in the way of local lifestyle perks on this resort island, like the outstanding spring weather, if you can take the time to “smell the flowers.” Let’s hope the bloom of springtime and budding activity in local home projects is a harbinger of better times to come — a housing market where there’s a better balance between supply and demand and home values that are trending up (at a more realistic pace than the boom years), instead of down. It appears we will need patience.