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Home sales hotter, just not here

By JAMES THORNER
Published December 28, 2006

Maybe it was balmy weather up North, maybe it was lower interest rates, but the country as a whole experienced a mini spike in new home sales in November.

Pity poor Florida: The Sunshine State, and most of the South for that matter, didn't enjoy the rebound.

Nationally, new home sales in November rose 3.4 percent from the previous month to an annual rate of 1.047-million. That exceeded economists' forecasts of a 1.018-million homes.

The national median new home price climbed to $251,700 in November 2006 from $237,900 in November 2005.

The South continued to slump. Annually adjusted sales from October to November showed a 9.3 percent decline to 529,000 homes.

The Commerce Department released the new home sales figures Wednesday.

Tampa Bay area builders, using incentives and price cuts to restore some semblance of sales stability, can't say for sure when they expect the slowdown to end.

Far fewer buyers cross the thresholds of once-bustling model homes in suburbs like those in central Pasco and southeast Hillsborough counties. The investors that ignited the boom last year have retreated. But so have regular buyers just looking for a place to live.

"I think '07 is going to stay pretty slow for most of the year. But I don't rule out an upward turn toward the end of '07," said Tampa Bay area housing analyst Marvin Rose.

Not all is doom and gloom. Some builders, including Standard Pacific Corp. and Beazer Homes, reported record years locally.

Beazer recently broke ground on Belmont, a 600-home subdivision off U.S. 301 near Big Bend. Sales start this winter.

"People are back out there shopping. But not nearly in the droves we've seen," Beazer regional president Ed Suchora said.

KB Home had cut prices across the board in some neighborhoods in Pasco, but has started raising prices for the first time in more than half a year.

KB spokeswoman Cara Kane said December traffic at Florida new home sales centers is higher than it was a year ago.

"Our inventory is slowly starting to come back to normal," Kane said of the company's Tampa operations. "As we move into 2007, we'll see that normalize even more."

Inventory improved nationally, falling to its lowest level since spring, but still amounting to six months worth of supply.

Still, some economists view the Commerce Department's numbers as overly optimistic. Unlike existing homes, which are counted sold after closing, new homes are labeled sold when contracts are signed. That could be a risky assumption: Builders have been reporting home cancellation rates above 30 percent.

What's more, home construction is coming off a horrible third quarter, when the industry reported the biggest drop in 15 years. Squeezed by housing, the economy grew 2 percent in the third quarter.

But Rose warned against taking too much stock in short-term comparisons. Compared to last year's gold-plated sales, everything looks tarnished this year.

"Any year-to-year comparison to '05 is comparing the peak market of all time to this year. It's almost certainly going to be down," Rose said. "But by most any other standard, '06 has not been a terrible year."

James Thorner can be reached at thorner@sptimes.com or 813 226-3313.

Builders getting their houses in order

Transeastern Homes: The builder of such best-selling neighborhoods as New Tampa's Live Oak Preserve has tried to stave off bankruptcy by laying off more than 100 and dismissing regional president Bob Krieff.

Ryland Homes: Heavily invested in Pasco County, Ryland's southeast division, which includes Florida, saw new home orders tank 64 percent from the third quarter of 2005 to the third quarter of 2006.

Centex Homes: Centex's sales this year have been leaden compared to 2005. In the Southeast region, the number of home contracts plunged 53 percent.

Beazer Homes: In the Atlanta builder's annual report in September, the company said new home orders dropped by a third in Florida. Its stronghold has been southeast Hillsborough County.

Pulte Homes: Based on its latest report, the nation's second-biggest homebuilder sold 29 percent fewer homes in the region that includes Florida. It has trimmed its work force 10 percent. Pulte is active in Clearwater, Seminole, Hudson and Wesley Chapel.

[Last modified December 27, 2006, 23:00:05]