A nationwide demand for waterfront property and the opening of the Suncoast Parkway bring more buyers to Hernando Beach, which doesn't have a beach but is laced with man-made canals.
HERNANDO BEACH - For years, Jennifer "Lee" Brokaw had dreamed of retiring to a waterfront home in the south Pinellas community of Tierra Verde, home to Fort De Soto Park, renowned for its pristine beaches.
She and husband, John "J" Brokaw, looked at waterfront property from Madeira Beach to Crystal River, including Hernando Beach, which they had never seen.
When they came across their $415,000, three-bedroom dream house at the end of a cul-de-sac on Gulf Winds Circle, they sat awe-struck at the edge of the swimming pool.
The same 5,500-square-foot house would cost close to $2-million in Tierra Verde, said John Brokaw, 60, who owns a mortgage loan company and knows his Pinellas County real estate.
"We thought it must have been O.J. Simpson's house or maybe there was a sinkhole we're not aware of yet, because it can't be right. It just can't be right," said Brokaw, who is semiretired from a sporting goods business.
For decades, Hernando Beach's man-made canals leading to the Gulf of Mexico have beckoned middle-class families and retirees who pulled boats up to weekend or winter getaway cottages and stilt homes without fear of breaking the bank.
But that's all changing, thanks in part to the opening of the Suncoast Parkway, a national housing boom fueled by low interest rates and a regional love affair with waterfront property.
Prices for Hernando Beach homes have taken off, and the most spacious and glamorous feature elevators, pools and breathtaking sunsets for prices that top $600,000.
Despite the misnomer - there's no beach except for one on a creek at a county park - Hernando Beach is now attracting interest from all over the country.
The population has grown by nearly 11 percent since the 2000 census - from 2,185 to the current estimate of 2,416. And the community is appealing to a relatively younger, and wealthier, population. Most newcomers say they were looking for a good investment.
Over the past five years, the average price of a home sold in Hernando Beach has risen 107 percent, the largest increase in the county, according to a Times analysis. The second-largest spike was in Weeki Wachee Gardens, just to the north of Hernando Beach.
In 1998, the median price for a Hernando Beach home was $95,000; by June 2003, it had risen to $196,250. Realtors say that both the north end, which has direct gulf access, and the south end, a deed-restricted community, are selling equally well.
The trend is not surprising considering the prices of beach and waterfront property rose from 92 to 164 percent throughout Pinellas County over the past five years, according to Times research. In Crystal River, prices were up 175 percent.
"Hernando Beach was kind of a lost area," said Florida Realty Centers broker David Birdsell, who holds the current record for the highest-priced home sale in Hernando Beach - $605,000. "But waterfront prices all around the state have escalated real high, and Hernando Beach is just catching up."Developer's vision now shared by many
Hernando Beach could not be created today. Conservation-minded state and federal laws now prevent the type of dredging and filling that allowed the community to be built in the early 1960s.
The labyrinth of canals was carved from wetlands and the gulf floor. Lots were developed from loads of imported dirt. The north end was developed first, which is why it has direct gulf access. People living in the newer, deed-restricted community, Hernando Beach South, can reach the gulf only with the help of a boat lift.
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Home sweet home no easy find
Neighborhood ripe for change a good gamble
Priced out of their markets
Appreciation with a caveat
In Seminole, real cows to cash cows
Roots aplenty in Driftwood
The elusive starter home
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Must be something in the saltwater
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Buying into Pasco's bargains
Going up: land values
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Wise buyers 'lucky,' content with beachfront home
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Charlie Sasser, 74, is responsible for developing the coastal community, a project that spanned 30 years and became mired in lawsuits and bureaucracy. But Sasser always hoped his brainchild would grow as popular as waterfront property farther south.
"As soon as everything was sold and there was no more, I thought that (prices) would go up, same as in St. Pete," Sasser said.
Hernando Beach grew slowly into a retiree haven, although it also appealed to middle-class couples in love with the water. Lots sold for a few thousand dollars, and one-story cottages composed most of the housing stock built prior to the mid 1980s, when stricter building codes went into effect.
When Long Islanders Judy Polatschek-Palais, 48, and Richard Palais, 53, finished building their $205,000 home on Flounder Drive in 1990, they were among the youngest couples living in Hernando Beach. And their three-bedroom home was among the largest in the community. Although their home is now worth more than $300,000, it is no longer among the largest.
"There are so many more high-end homes," said Palais, who in late January was buying lunch meat at his new favorite lunch spot, HB Gourmet Deli & Catering. "This place has been discovered, no question about it."Midlife discoveries and investments made
Forrest Bennett is a self-employed former New Yorker who makes his own cappuccino and often zips down to Tampa for concerts, and more far-flung cities for his job in the travel publishing business.
At 46, he may seem a young and unlikely match for Hernando Beach. But the divorced dad is among a growing number of more financially secure and cosmopolitan residents who have recently moved to what some call the best-kept secret on the North Suncoast.
Bennett grew up in Miami, worked in Manhattan, Atlanta and Fort Lauderdale, and has traveled all over the world. Now he lives on Biscayne Drive.
"The nature of my business is travel, and of all the places I've seen, I really haven't come across a better value and quality of life," said Bennett, whose parents also lived in Hernando Beach. "It's really a fantastic place to live and invest in."
Hernando Beach's newest residents come from all over: other parts of Florida, the Midwest, the East Coast, and as far away as Ireland. Although demographic information is unavailable, Realtors say they are seeing more people in their 40s, 50s and 60s who have some savings and are getting closer to retirement, although not there yet.
But, the No. 1 reason for buying in Hernando Beach is it's a good investment, dozens of new homeowners said. And that's also what is causing prices to escalate.
Hernando Beach homes have been changing hands at a high rate in recent years. At the start of 2004, there were 1,238 homes in Hernando Beach, and over the past five years there were 538 home sales in the community. That number includes homes that were sold more than once and excludes sales of lots on which homes were built.
In 2003, Hernando Beach property accounted for $238.8-million of the county's assessed taxable value, compared with $112-million a decade ago.
"A lot of people buy for speculation purposes, and turn around and put it right back on the market for 50 to 75 percent more than they paid for," said Lance Sutter, a sales representative with Exit Success Realty, a company that sold about 60 homes in Hernando Beach last year.
Like the Brokaws, soon-to-be retirees are scouring Florida's central gulf coast, searching for waterfront property, and are shocked to see the comparatively low price of Hernando Beach real estate.
Another financial factor fueling interest is the view of the stock market as unstable. Many are turning to real estate as a financial outlet for their retirement savings, several Realtors said.
"Right now, everyone's taking their cash from their mutual funds and putting it into real estate," said Richard Doyle, a sales representative with Hernando Beach Realty who lives in Hernando Beach South and is planning to build on the north end of the community.
A case in point is Kim Norris, who just bought a $155,000 one-story bungalow on Cedarbrook Lane. The 33-year-old Tarpon Springs resident and her 40-year-old husband, Cassey, own a commercial painting business and do not plan to move from Tarpon Springs. They bought purely for investment.
"I never invested in anything, and I didn't think you could lose on the water," said Norris, who is hoping her house will be worth $200,000 in three years. She found a renter within a day of closing on the two-bedroom house. "I think it's a lot safer of an investment than the stock market."Preserve creates tranquil transition
For those seeking to live on the waterfront, Hernando Beach gives them a sense of isolation, many new homeowners say.
Entry is guarded on the east by a 6,000-acre wildlife corridor, home to a small population of black bears and eagles. The five-minute drive through the preserve is considered, by some, a cleansing transition after an ugly jaunt along a soulless stretch of U.S. 19.
"I knew this was the place as soon as I saw the preserve," said Carrie Palcisko, 61, who moved with her husband, Ed, from Naples to a home on Bluefish Drive in March 2003.
Another draw for the Palciskos and others is that most waterfront communities along Florida's west coast are far more populated and congested. In Hernando Beach, while traffic along Shoal Line Boulevard has increased over the years, it still only takes minutes to get across town.
When Susan and Jack Ruegamer wanted to move closer to family in Pasco County, they were distraught over Pasco's congested roads. The Ruegamers lived in a small town in the Catskill Mountains in New York.
"We decided to try farther north, and I made a wrong turn and found Hernando Beach," said Susan Ruegamer, who is in her late 40s and bought a $250,000 house on Sheephead Drive in Hernando Beach South with her husband last July. "It's a waterfront community with a small-town feel."
With commercial space relegated to the outskirts of the residential area, Hernando Beach homes, nearly all of which are on water, seem more safe and cozy, which is attractive to younger families.
Indeed, children have arrived. Several long-timers said they never thought they would see the day when school buses rumbled down the community's long, winding streets.
"It's peaceful, and there's something calming being out here on the water, and I like that environment for my children," said Michelle Card who last June moved with her children - ages 7, 9 and 11 - from Brooksville to Hernando Beach.Affluence washes in and draws in business
Next to the Beach Bar, a longtime hangout for shrimpers on Shoal Line Boulevard, hangs a bright yellow "Gallery & Gifts" sign, bracketed by palm trees.
The waves of affluence washing across Hernando Beach brought Wolding Fine Art Gallery & Gifts to the community last May, featuring a mix of tourist gifts and artwork by local artists.
The gallery is one of several additions to Hernando Beach's commercial sector that are specifically aimed at the area's more affluent residents. Two new dining establishments have opened over the last six months - HB Gourmet Deli & Catering and Lady L's Supper & Blues Club.
Gallery owner Susan Wolding is an artist who works primarily with seascapes and underwater scenes, which she perfected while apprenticing in Hawaii and sells at her gallery. When she and her husband moved to Weeki Wachee Gardens from Michigan a year ago, she noticed Hernando Beach and its ritzy cars and gourmet restaurants.
"We realized that Hernando Beach is a growing community and noticed there wasn't a gift shop of value around," said Wolding, 49, who now has 900 square feet of exhibit space.
Much of her business comes from new homeowners looking for nautical and jungle decor, but she also caters to the clientele next door, offering 14-karat gold shrimp pendants and wood-carved shrimp art.
Down the road is another fine-dining restaurant that started as a lark.
When Tom McEachern moved to Hernando Beach about three years ago, he thought it would be to retire. Six months later, the longtime chef and restaurant owner, whose parents used to own the Bayport Inn, opened Bare Bones Fish & Steak House, a gourmet restaurant whose rack of lamb and escargot attract chow hounds from Crystal River to Sarasota.
While Bare Bones now draws 75 percent of its business from outside Hernando Beach, it also depends on the support of the community, McEachern said.
"We saw (the changes) coming; there's no question about it," said McEachern, 63, who plans to sell his Hernando Beach home on the gulf for $600,000 in order to build another one.
Several local real estate experts agreed that Hernando Beach will continue to change for many years to come. By their estimates, property values have appreciated to about 50 percent to 60 percent of where they may eventually reach.
"We're always going to trail Clearwater and St. Pete," said Doyle, of Hernando Beach Realty. "But people will continue to drive up the coastline looking for waterfront property and by luck find Hernando Beach."
The transition has crept upon the community rather smoothly, with half-million-dollar mansions going up not far from 30-year-old, one-story cottages on the north side.
Many new and longtime homeowners said they love their tight-knit community and appreciate their friendly neighbors. Nobody could cite any recent confrontations or tension like the kind several years ago that framed the relationship between some Hernando Beach homeowners+and shrimpers.
"We're very pleased with the new people moving in here, because they're improving the community, building bigger, more valuable and attractive houses," said Fran Baird, a 23-year resident of Hernando Beach and president of the Hernando Beach Property Owners Association.
"We've been a little sleeping community for a long time, and now we've been awakened."
- Staff writer Matthew Waite contributed to this report.