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Housing market gobbles up land

Fewer permits are issued only because fewer lots are available for builders in the county.

By STEPHEN HEGARTY
Published July 6, 2005

Pasco's record-setting pace for housing starts actually slowed during the first half of 2005, as fewer single-family home permits were granted the first six months of the year than last.

Has the housing market has cooled off? Not at all.

It appears that the reason for the slowdown is a shortage of ready-to-go lots. It's a simple matter of the demand for homes outpacing the supply of spots ready to build.

"There's no lots out there," said Tony Polito from the Tampa office of MetroStudy, the national housing market consulting firm. "There is plenty of demand, but because there are no lots, houses literally cannot be built fast enough."

Polito estimated that Pasco had an estimated seven months' supply of housing lots available. The norm is an 18- to 24- month supply.

Even though Pasco's single-family permit numbers slowed, they didn't slow by much, about 4.5 percent. The numbers were off in January and February, then rebounded robustly in May and June.

Housing experts say the lack of available lots is expected to do nothing to dampen demand for single-family homes in Pasco. The most likely result is driving up prices and values because there's a large number of buyers chasing a limited number of new houses. The average new home price in Pasco was $197,000 in June 2004. At the end of the first quarter of 2005, the figure was up to more than $235,000, Polito said.

"People are flat out buying property in Pasco County," said Property Appraiser Mike Wells. "From what I've seen, everything's cooking."

The housing boom has continued despite increases in impact fees both last year and this year, and some negligible increase in interest rates, which still remain low.

"So long as interest rates remain low, I don't see any slowdown," Wells said.

The creation of homes and the price increases have done wonders for Pasco's tax base. The tax base - the taxable value of all property, both residential and commercial - rose from $16.3-billion in 2004 to more than $19.3-billion in 2005. That increase either results in more tax revenue, or possibly lower tax rates since the county and School Board can reduce rates and still collect as much revenue.

[Last modified July 6, 2005, 00:50:11]