By Shannon Behnken, Tampa Tribune, Fla.
July 27--TAMPA -- A building boom, followed by a lackluster economy, has left the five-county area around Tampa with enough vacant homesites to last builders nine years. And that doesn't even count all the land set aside for new subdivisions.
There are 27,923 vacant lots, including multifamily, primed for construction in Hillsborough, Hernando, Pinellas, Pasco and Citrus counties, according to second quarter data from Houston-based housing research firm Metrostudy.
The number is a striking reminder of how deep the housing crisis in West Central Florida has become and how long it will take to struggle back to a sustainable level.
"The housing industry in Tampa Bay needs the economy to improve," said Tony Polito, who gathered the data. "The area needs jobs."
The breakdown by county is even more telling. Here's the supply of single-family lots and how long it will take to absorb them at the current sales pace:
Hillsborough: single-family lots -- 9,594; years of supply -- 4 years, 9 months
Pinellas: single-family lots -- 764; years of supply -- 14 years, 2 months
Pasco: single-family lots -- 6,011; years of supply -- 6 years, 6 months
Hernando: single-family lots -- 3,969; years of supply -- 45 years, 6 months
Citrus: Numbers were not available.
So how bad is this? Polito said a healthy market in Tampa Bay has about 24 months of finished, vacant lots. Even so, demand has improved.
The 896 homes built during the second quarter was the best quarter the Bay area has seen since the third quarter of 2008 when 934 homes were started, he said.
The federal tax credit boosted sales last year and led builders to buy more vacant lots from developers. Some subdivisions that were started during the housing boom are finally getting finished. However, builders report buyer interest has slowed considerably since the credit expired in April.
Nationwide, sales of new homes jumped last month, but the overall pace was the second slowest on record.
The Commerce Department says new home sales rose nearly 24 percent in June from a month earlier to a seasonally adjusted annual sales pace of 330,000. May's number was revised downward to 267,000, the slowest pace on records dating back to 1963. Sales for April and March were also revised downward.
In Tampa Bay, Polito said builders would construct between 8,000 and 10,000 homes a year in the five-county area during a healthy market. That compares with the 3,090 homes constructed during the past year.
The only builders having success now, said Jack McCabe, a Florida real estate analyst, are ones that bought lots for fire-sale prices during the downturn. Those builders have a competitive advantage, he said.
Even so, there are thousands of foreclosures and short sales on the market for steep discounts, and new homes often can't compete on price alone, said McCabe, of McCabe Research & Consulting.
"In most Florida markets, at least 40 percent of the properties listed for sale are distressed," he said. "It's really difficult for a builder to construct a home and sell for a profit in an environment where distressed homes dominate the market."
The other problem, McCabe said, is the economy. Buyers won't buy homes if they don't have jobs or fear losing them. Although there have been bright spots in the economy lately, overall the recovery of the housing market is expected to be a slow process, McCabe said.
"There's nothing on the immediate horizon that would make any builder say, 'Wow, now is the time to start building.'"
Information from The Associated Press was used in this report.
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