ST. PETERSBURG - The city's high-end housing market can be hard to fathom. Some empty lots on Snell Isle are selling for more than $1-million.
But even as the prices lift off for the stratosphere, well-off people move here because they think top-drawer property is still quite affordable. In other cases, the next generation of old-line families are returning home to take up residence.
There are neighborhoods where the draw is the big old house. There are neighborhoods where the draw is the big new house. But all the costliest neighborhoods have one thing in common: waterfront.
Some of the priciest waterfront in St. Petersburg is in neighborhoods that are little recognized. After all, the city has more than 100 defined neighborhood associations. Because Snell Isle is St. Petersburg's best-known upscale neighborhood, people might assume it is the city's most expensive.
But it's not, at least when measuring the median price of a home in the neighborhood - the median being the home in the middle with an equal number above and below it.
Recent figures suggest that Snell Isle might rank a mere seventh behind other wealthy neighborhoods such as Bayway Isles and Sunset Drive. Some of the priciest neighborhoods are so small you may never have heard of them. Each is rich in its own way.
For the first seven months of 2003, the median price of a home on Snell Isle was $432,500. In Bayway Isles, it was $789,000, followed by Sunset Drive, where the highest median price was $781,750 in 2001 (there were no sales in 2002 and the first seven months of 2003), and Yacht Club Estates, where it was $627,500 in the first half of 2003. In Renaissance, it was $484,500 in 2002; in Venetian Isles, $462,500 in the first seven months of 2003; and in Tropical Shores, $450,000, also in the first half of 2003.
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Although Snell Isle's prime waterfront properties command millions, its rival neighborhoods have a higher percentage of waterfront lots. That is one reason Snell Isle has a lower median price, Realtors say. In addition, it is a larger neighborhood with a wider range of housing.
And in some of the smallest neighborhoods, a few pricey sales can greatly - and perhaps artificially - drive up the median. In Tropical Shores, for example, there were only seven sales through the summer of 2003. In Sunset Drive there were none. In other words, be cautious in making too much of the numbers when they are so small.
Cary Bond Thomas of Tourtelot Brothers Inc., whose luxury home listings sometimes appear in Christie's Great Estates magazine, has two contracts for essentially vacant Snell Isle waterfront lots for more than $1-million each.
The sales price was $1.9-million for one lot, where a house was torn down in preparation for a grander one, and $1.5-million for another occupied by a 1950s house slated as a teardown. Both lots are on Snell Isle's much coveted Brightwaters Boulevard, with its sweeping waterfront views.
"Probably the most expensive listing in our area is Brightwaters," said Carole Merritt of Coldwell Banker, mentioning a listing for more than $6-million.
Ms. Merritt, whose luxury property listings include Tierra Verde, the gulf, Brightwaters, Old Northeast, Bayou Club and Bayway Isles, is selling a Brightwaters house for more than $3-million and two lots for $3.5-million.
On Bayway Isles, she has three homes listed, for $3.4-million, $2.2-million and $2.5-million.
"I think that south Pinellas is pretty much built out and, of course, our waterfront," she said. "So, as a result, you have seen the prices escalate in the past year and a half."
Others in the business echo her words.
"It's absolutely amazing what's happening in the city, and I love it," said Eileen Bedinghaus of Lambrecht & Associates Inc.
Let one small home tell the tale. "I sold a little home for the third time in just over a year to a young couple that just got married," Alona Dishy of Realty Executives said of a Snell Isle house.
"This home went from approximately $175,000 to $237,500 to $311,600. And it is still a very good buy," said Ms. Dishy, whose property sales were over $18-million in 2003.
Who are these people?
Preference often determines where people choose to live, Ms. Bond Thomas said.
"Some people want North Shore. Some people have to have Snell Isle. Some people want the Pinellas Point area with all the trees. They wouldn't even look at Snell Isle," she said.
"Different buyers are adamant about what they want, and since they can afford anything . . ."
Who are these people? Ms. Merritt, the Coldwell Banker agent, says they are business owners, professionals and corporate heads coming mostly from the Tampa Bay area, some from Tampa because of the easy commute. Others are relocated executives and a few, retirees from Northern states. The area also is a hit with people from other parts of Florida, she said.
"We're still competitive price-wise. Proximity to the airport, plus our downtown and our beautiful water have become a big draw," Ms. Merritt said.
The neighborhoods attract buyers for a variety of reasons. Snell Isle, developed in the 1920s, often is home for old, prominent St. Petersburg families and their returning children. A newer area such as Bayway Isles tends to attract younger families, one Realtor observed. Another noted that Venetian Isles, generally less expensive than Bayway II - the newer section of Bayway Isles - is considered a good place for those buying their first waterfront home.
About 90 percent of the properties on Bayway Isles, a neighborhood just west of Eckerd College and south of the Pinellas Bayway, are on the waterfront, Ms. Bedinghaus said. Houses in the community, where development began in the late 1960s, tend to be large.
"People who are buying there are a combination of young families and maybe some of the more established," said Ms. Bedinghaus, adding that prices range from half a million for inland homes on Bayway I and "up to the sky almost being the limit" for custom, waterfront homes on Bayway II.
She described Renaissance, a tiny neighborhood across Riviera Bay from Weedon Island, as "a smaller community of extremely lovely homes," where about 70 percent are on Tampa Bay or lakefront.
Renaissance is popular with corporate relocations because of its large homes, Ms. Merritt said. It's a place for families rather than empty-nesters and is considered a good location for those who work in the Gateway area.
Yacht Club Estates also has many young families, she said.
"It's not as pricey as Snell Isle and more comparable in price to Venetian Isles. The homes are older, so people are buying and redoing and they're tearing down and rebuilding," Ms. Merritt said.
Venetian Isles, she added, had seen its property value triple in the past six to eight years.
SNELL ISLE, No. 7 at $432,500
Lori Riechert is putting a brave face on her move from the Snell Isle home she and her family bought for $126,900 in 1997.
The day the movers came, she let her two boys, Cole, 5, and Luke, 3, swing one last time from the oak tree in the front yard of their Monterey Boulevard home.
The Riecherts were moving to their new home in Texas, where Jerry Riechert, a manager for First Franklin Financial Corp., recently had been transferred.
"When we moved in the house, I wasn't pregnant yet," Mrs. Riechert reminisced. "We wanted to be in the northeast area. We looked in the Old Northeast and on Snell Isle. We liked all the trees and because it was close to family. We found this house and it was really ugly and we really didn't have a lot of money at the time and did a lot of work on it ourselves. ... It's just been home. We've raised our children there."
They put the four-bedroom, three-bath, ranch-style house at 945 Monterey Blvd. NE on the market a few days before Christmas. On New Year's Eve, they had an offer. They sold it for $485,000.
"We priced it fairly so we could sell it in a reasonable amount of time. We wanted to be practical," Mrs. Riechert said.
At the same time, she added, "We wanted to get a fair price, because we know we are in an area that was booming."
The Riecherts have bought a home in a Houston suburb. It is newer and larger and cost less than the selling price of their 1956 Snell Isle home.
"We joke that we wouldn't be able to move back home and live the way we've been living, the way prices are going up here," said Mrs. Riechert, a St. Petersburg native with family on Snell Isle.
"We're buying a really nice house out there, but it wouldn't go up in value as much as the houses are going up in value here. It's such a different market out there, because there's so much land and so many new areas."
Mortgage broker J.C. Russell understands Snell Isle ties. His wife grew up there and his mother-in-law still lives in the same home. When Russell's family moved to St. Petersburg from Miami in 1988, that's where they bought their home.
"After living in Miami for eight years, I really saw Snell Isle as the Coral Gables equivalent in St. Petersburg in terms of location and demographics," said Russell, owner of All American Mortgage Co.
Snell Isle is "a convenient location where our family does "life,' " he added, pointing out that it's near his downtown office, shopping, the interstate to Tampa and businesses along Fourth Street.
Russell and his wife, Carol, who have a daughter, Rachael, 17, bought a second Snell Isle home in August and put their first on the market. They wanted more room, said Russell, whose parents have also made their home on Snell Isle from the Florida Keys.
The bigger home cost $675,000, Pinellas County records show. The Russells' old home is on the market for $400,000.
Jeffery Wolf, a general contractor on 14th Avenue NE who builds custom homes in the community and does remodeling projects there, has been hired to replace smaller, older homes with larger, grander ones. Three have been on waterfront lots.
He said the teardown trend is driven both by Federal Emergency Management Agency regulations and the fact that people like larger homes. He doesn't encourage people to demolish homes with historic value, he said.
"Most of the houses that were originally built on Snell Isle were below the required finish-floor elevation requirements for FEMA," he said.
"You're only allowed, in terms of spending money for new construction such as additions or remodeling, 50 percent of the value of the structure before you have either to tear it down or you are allowed to raise the finish floor to comply with the federal regulations," Wolf said.
People have been tearing down homes on Snell Isle for about 10 years, he said, but the trend has gained momentum over the past six years or so. Given the optimum economic conditions, Wolf thinks it is a trend that will continue.
"I think," he said, "that people will continue to build larger houses and therefore they will be tearing down the old, smaller houses in order to get a house that's commensurate with what they've paid for the property."
BAYWAY ISLES, No. 1 at $789,000
Y.Y. Phillips Jr. and his wife, Bettye, moved to Bayway Isles in December 1969 from Fort Bayne, Ga. Freshly discharged from the Army, Phillips was looking for a place where he could put down roots and raise a family.
After searching the county from top to bottom, the couple settled on a 4,300-square-foot house with four bedrooms and four bathrooms in Bayway Isles, for which they paid $130,000.
"It was new, fresh and on the water. It looked like quality development," Phillips said. "At that time, I'm guessing there were 20-odd houses on the island."
Now, the former homeowners club president said, there are 192 developed sites and 24 undeveloped lots in the gated community.
Phillips, who is 77, was not surprised to learn that the median price for homes in Bayway Isles has jumped from $397,850 in 1998 to $789,000 in 2003, making it nearly the priciest neighborhood in Pinellas. He knew from the start that his home would be a good investment.
He says the wide-open water is the main attraction, but thinks that in recent years, people have been attracted by the toll gate that lies just west of Bayway Isles' entrance because it cuts down on traffic and offers a measure of safety.
Efforts to beautify the approaches also have contributed to the neighborhood's value, Phillips said. A strong homeowners association that enforces deed restrictions is another plus.
One thing he has noticed over time is that more families have moved into the neighborhood, resulting in a comfortable mix of young professionals, children and retirees.
"It's an amiable community that pays more than its share of taxes," Phillips said.
Ms. Bedinghaus, the Lambrecht & Associates Realtor, said Phillips is a typical Bayway I resident who came to the neighborhood in the late '60s or early '70s and stayed. Homeowners to the west in Bayway II, which was developed in the mid 1980s, tend to be younger. Their homes often are more dramatic because they were designed by architects rather than builders.
"There are some amazing homes out there," she said. "When they first started off, a typical waterfront lot in Bayway II went for $85,000 to $100,000. There are still some waterfront lots out there, but you're looking at three-quarters of a million dollars just for the land."
VENETIAN ISLES, No. 5 at $462,500
Peggy Weniger knows Venetian Isles both as a homeowner and as a Realtor with Coldwell Banker. In 1978, she paid $190,000 for a three-bedroom, two-bath home on Mermaid Point. Several years later, she invested another $100,000 to expand it from 2,700 to 3,500 square feet.
"For a while, it didn't appreciate much in value. Then all of a sudden, boom," she said. "Now my house would be worth $500,000 to $600,000, and that's on protected water. Open-water homes go for anywhere from $800,000 to $1.6-million."
Overall, homes in Venetian Isles have appreciated so much that the city of St. Petersburg's Web site cannot keep up, Weniger said.
"Currently, the site says homes range from $170,000 to $1.5-million, with many homes in the $225,000 to $250,000 price range," she explained. "But I have the least expensive home in the neighborhood listed at $430,000."
For a number of years, people have been buying properties in the $800,000 range, tearing down the homes and putting up larger ones, Weniger said. In the past five years, the trend has largely contributed to a doubling of the median price from $221,800 to $462,500.
It's a trend that astounds Bob Johnson, who has lived in the 598-home community for 33 years.
"It amazes me that someone can come in and buy a $450,000 house and 20 minutes later, it's torn down and they're rebuilding some incredible house," he said. "They're doing it because this is the best waterfront in the city."
Johnson and his wife, Carol, paid $34,000 for a 2,400-square-foot, two-bedroom, two-bath home in 1971 that today is worth between $700,000 and $800,000.
"It was the best decision I ever made," Johnson said. "No investment has made as much money as this house."
Johnson, 69, is a retired military man who has served as the homeowners association president for six years. He said the deed restrictions are the main reason for success. Comparably priced homes in other areas such as Snell Isle are not as sought after, he thinks, because the restrictions are not as diligently enforced.
"You can look at homes that were built at essentially the same time as those in Venetian Isles and you'll see cars jacked up on blocks," he said. "It detracts from the neighborhood."
With so many homes being torn down to make way for new ones, Johnson said, the homeowners association stays busy. Among the members' primary concerns is making sure that new construction does not interfere with what Johnson calls "lateral vistas."
"We depend on looking across neighbors' properties," he said. "We don't want people building in what we call the set-back areas."
A future trend appears to be three-story homes, Johnson said, which means home values will continue to rise.
"Where the money is coming from, I don't know," he said. "It's just mind-boggling to me, but the homes do seem to get grander."
Peter Ford, a former salesman in the technology field who became a real estate developer two years ago, said Venetian Isles is the perfect location for investors who can afford to buy property and hold on to it for a year or so while they go through the teardown and rebuilding process. The challenge, he said, is looking for a $100,000 home on a $1-million lot.
Ford, 41, is closing on such a property. He paid $620,000 about 18 months ago for an older home on wide-open water and began building a five-bedroom, 51/2-bath house. Before the house was finished, the property had appreciated so much that he decided to add two bedrooms.
"The original asking price was $1.65-million. We're selling it for just under $1.8-million," Ford said. "Similar houses in the area are selling for approximately $1-million. Those are considered teardowns also."
Ford looked at properties in both Pinellas and Hillsborough before deciding that St. Petersburg - Venetian Isles in particular - had the lowest-valued high-end waterfront property available.
"People up North are retiring at 55 or 60 and finding they can buy a 6,000-square-foot house on open water for what they sold their three-bedroom home for," he said. "There seems to be an unlimited number of buyers coming here."
The couple who bought the home Ford is building had already lived in Venetian Isles for five years. Joseph Molea and his wife, Heidi, arrived in 1999 after a fruitless search for a three-bedroom, three-bath waterfront home in south Tampa.
Their Realtor told them about a "bargain-basement" waterfront property in Pinellas listed in the high $300,000s that was 30 minutes from Tampa.
"We chose it for two reasons," Molea said. "We knew we wanted to be on the water and we liked the idea that it was deed restricted so we could sort of predict a certain level of maintenance."
But within a year, after adopting twins and having a baby of their own, the couple needed a bigger house. They put their house on the market for close to $500,000 and bought a 4,000-square-foot home on the same street listed in the mid $700,000s.
About a year ago, their Realtor told them about the home Ford was building. They agreed it was too good a deal to pass up.
"It was startlingly nicer in terms of usable space," said Molea, who is chief medical officer for Health Care Connection in Tampa. "We had decided this would be our last move, but it was such a big improvement for the value that we decided to go ahead and sell our home and purchase Peter's."
The home they live in now is on the market for $1.6-million. Molea doubts he'll have trouble selling it, but he knows he has some breathing room.
By the time he closes on his third Venetian Isles home, he will have already accumulated equity because the property has appreciated since the purchase date.