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Lots of lots, few are homes

Homestead filings haven't kept pace with development, some say.

By DAN DEWITT
Published April 1, 2007


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SPRING HILL - Eleanor Andriole likes her new house in Sterling Hill, but she's not so sure about the neighborhood.

Looking down the street from her driveway, she counted half a dozen vacant homes, a couple of rentals and only two other houses occupied by their owners.

"I wish some people would come in and live on this street," said Andriole, 81, who bought the house with her son, Joseph, last year. "I feel very lonely here."

The situation is similar in most of Hernando County's newest subdivisions. Though the developments were planned and built during a historic real estate boom, homes owned and occupied by residents are more scarce than expected.

In several communities in or near Brooksville, including Hernando Oaks and Southern Hills Plantation Club, the problem is simple: Fewer homes have been built than anticipated.

Most projects close to the Suncoast Parkway got off to a faster start, especially Sterling Hill, where 933 houses had been built by the first of the year. But judging from the number of homestead exemptions owners sought for 2006, many of the new houses in these projects are owned by investors or builders.

Several builders said this glut in houses and lots is only temporary. The market has begun to rebound from its slump, they say, and buyers have already cut into the inventory of houses.

"We are legitimately seeing the tide turn," said Fletcher Davidson, sales manager for Grant Homes LLC of Tampa, one of the builders selling homes in Sterling Hill. "We are seeing a lot more traffic, and these aren't investors. These are people with a sincere interest in buying homes."

But others see a different message in the property appraiser's records. The county has an oversupply of new subdivisions, they say. Before allowing more, the county should wait to determine the true impact of these projects on the county's roads and water supply.

County Commissioner Diane Rowden said landowners seeking rezonings are "mining for gold" - increasing the value of their land, which they don't plan to develop until the market improves.

"I don't see why we need to keep running out and approving more housing developments," she said.

'Market was crazy'

Builders and developers offered several explanations for the large number of homeowners who have not filed for homestead exemptions in subdivisions like Sterling Hill.

Some of the houses are second homes. Some are models.

But most of the houses, they acknowledged, are homes that builders or investors planned to sell but have not been able to. In some cases, they fell back into the builders' hands after buyers backed out of their contracts.

Jeff Shubrooks, a salesman for Avatar, said there was good reason buyers flocked to Sterling Hill when lots went on sale in late 2004.

The subdivision has gates although, partly to welcome prospective buyers, the gates are open during the day. Also, its common areas are immaculately landscaped.

Prices, which start at about $200,000, are far lower than comparable subdivisions farther south. Located just west of the parkway on Elgin Boulevard, the development offers a reasonable commute to Tampa.

Avatar, which currently owns 29 houses in Sterling Hill, limited investors by allowing each buyer to purchase only one home and by giving priority to customers who said they planned to live there.

But some buyers, Shubrooks said, probably purchased houses under the names of relatives or misled sales agents about their intention to live in Sterling Hill.

"The market was crazy then," he said, "and there were so many speculators."

As the slump deepened last year, many buyers cut their losses, forfeiting down payments rather than continuing to pay for houses they could not sell.

The large inventory of homes, along with low interest rates, could work to the advantage of buyers, Shubrooks said: "If people are looking to buy, now's the time."

Individual owners have had a hard time getting that message to the public, said Kathy Korson, who lives in South Tampa and bought a house in Sterling Hill a year ago.

They are competing against builders with more marketing power, some of whom have slashed prices. Inland Homes, for example, recently advertised a "closeout at Sterling Hill," cutting prices as much as $55,000 and offering to pay $2,500 in closing costs. Deed restrictions prohibit individual owners from posting "for sale" signs.

"We've had it on the market since March of last year. We've had open houses and advertised everywhere. It's ridiculous," said Korson, a paralegal, who said she paid a total of $24,000 in monthly payments for her mortgage, taxes and insurance since last April and is now thinking of selling the house at auction.

"I just don't know how long I can keep making the payments."

'Wave is not coming'

The improving market that builders talk about is not yet apparent in county statistics.

Although most large builders do not list their houses in the Multiple Listing Service used by real estate agents, the MLS is a common measure of demand, and the number of homes listed in Hernando briefly dropped below 800 in mid 2005. The number climbed rapidly through 2006 and in recent months has held steady at about 4,000 homes, with 4,366 last week.

The flood of county permits issued to build new houses, meanwhile, has slowed to a trickle. During the building boom, the county typically issued more than 300 permits per month. In the past four months, the average has been less than 100, including 60 for the first 29 days of March. Of those, only seven were issued in the new subdivisions in the county.

The permit statistics from the city of Brooksville, though, show that more homes are due to be built in two subdivisions, said Bill Geiger, the city's community development director. Brooksville has issued a total of 51 permits for houses in Southern Hills, developed by LandMar Group LLC of Jacksonville, and 55 for the Cascades, which is owned by national builder Levitt & Sons.

LandMar has advertised its project aggressively, with an open house in February and a makeshift billboard on the side of a semitrailer parked along the State Road 50 truck route.

But Mark Vallery, one of the builders in Southern Hills, said he noticed a rise in interest before the open house, in mid January, when the number of prospective buyers visiting his models jumped from about five per week to about 25.

His company, Vallery Custom Homes, has sold 19 houses in Southern Hills. That number includes 13 "cottages," houses built on small lots that are included as part of the sales price, starting at $300,000.

Roger Elliot has hired Vallery to build a 7,000-square-foot house on a large lot near the clubhouse at Southern Hills.

"It's a great golf course, it's a great community, and it's what we're looking for as far as access to Tampa and still being out in the country," Elliot said.

Though the market is flat, he said, "Our perspective is for the longer term rather than in the next two or three years. We're not concerned about it."

Neither is Brooksville City Council member Lara Bradburn. The sluggish sales have forced the city to postpone such plans as expanding the sewage treatment plant to serve new development. But she sees no reason to rein in ambitious plans to annex land around the city for future development.

It will come eventually, she said: "I don't think we need to worry about whether growth is going to hit the city of Brooksville."

Joe Murphy, the conservation chairman for the Hernando Audubon Society, disagreed, saying the inevitability of growth is a pervasive myth.

The statistics on development and occupancy rates of the new subdivisions do not include others, such as Majestic Oaks in Brooksville, which have received rezonings for development but have not yet started selling lots. Nor do the numbers take into account the inventory of lots in several proposed developments of regional impact, including the 4,800-lot Sunrise project planned for Ridge Manor West.

"We're always told there's this wave of growth and there's nothing we can do about it," Murphy said.

"Once we realize this wave is not coming, we can slow down, take a deep breath and see what Hernando County should look like in a few years. We don't have to rush to build subdivisions as fast as we can."

Dan DeWitt can be reached at dewitt@sptimes.com or (352)754-6116.

How the numbers add up

Seven subdivisions with more than 500 lots have been developed in Hernando County since 2000. The statistics on the number of homes built and the number of residents who have filed for homestead exemptions are current as of the end of 2006. Homeowners may apply for exemptions only on their primary residences.

SOUTHERN HILLS PLANTATION

Lots approved: 999

Lots developed: 833

Houses built: 29

Homestead exemptions: 5

CASCADES

Lots planned: 925

Lots developed: 392

Houses built: 29

Homestead exemption filings: 1

HERNANDO OAKS

Lots approved: 975

Lots developed: 460

Houses built: 173

Homestead exemption filings: 92

TRILLIUM

Lots approved: 891 lots

Lots developed: 446

Houses built: 227

Homestead exemption filings: 148

VILLAGES OF AVALON

Lots approved: 797

Lots developed: 590

Houses: 82

Homestead exemption filings: 22

SPRING RIDGE

Lots approved: 520

Lots developed: 520

Houses built: 171

Homestead exemption filings: 43

STERLING HILL

Lots approved: 1,250

Lots developed: 1,250

Houses built: 933

Homestead exemption filings: 301

Source: Hernando County Property Appraiser's Office

[Last modified March 31, 2007, 19:26:56]


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