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Fewer permits were issued in Hernando County for new homes in 2000 than 1999, records show, despite the Suncoast Parkway.
By SAUNDRA AMRHEIN
© St. Petersburg Times, published January 13, 2001
Despite predictions of booming new-home growth to accompany the building of the Suncoast Parkway, the number of residential building permits dropped slightly in 2000, while the resale of homes continues to climb in Hernando County.
Builders and planners blame higher construction costs and rising interest rates during the past year for the decline in building permits for single-family homes compared with 1999. They say the effects of the Suncoast Parkway, which opens next month, won't be felt for another few years.
"I think everybody is overrating the immediacy of that parkway," said builder Bob Eaton of Artistic Homes Enterprises Inc. "I think it's going to take years before that impacts the area from a housing viewpoint."
In the meantime, resales are outpacing new home construction because of a rise in the cost of labor and building materials, he said.
"We've had three years of inflation of housing costs," Eaton said. "We're not like the used-housing market. As builders, we can't choose to go down in price. Whatever it costs to build the house, that's what we have to pay and that's what we have to charge."
The number of permits for single-family homes stands at 1,146 for 2000, down 68 from 1,214 in 1999, according to Hernando County's Development Department. That's a 5.6 percent drop.
That number is down considerably from the housing boom of the 1980s, when construction hit 2,500 new homes some years.
"In the 1980s, we were selling houses at $40,000 to $80,000, and now that same type of (home) is going to be -- just add $40,000 to both numbers," Eaton said.
Another reason for a drop in the number could be that there are no large new subdivisions breaking ground, he said. Several are on the books and a few, such as Pristine Place, continue to fill in with new homes. But another surge won't hit until some of the proposed communities get off the ground.
"There are not a lot of new things happening," he said.
In contrast to the slight drop in new home permits, resales went up last year, as of Dec. 29, from 2,322 to 2,557, an increase of 10 percent, according to the Hernando County Association of Realtors.
The average price of an existing home last year was $87,271, up from $81,085 in 1999.
Buddy Selph, owner of Tommy Dawson's Realty, was not too impressed with the increase in the number of home resales and instead called the market "steady."
He agreed with Eaton that the reason resales appear to be doing better than new homes is the increasing cost of construction.
Also, he thinks that more families are jumping from starter houses to bigger houses more quickly than in the past.
"Maybe it's that society has become more risk-taking and a lot less conservative than what our parents used to be, not wanting to wait," he said. "They can pay for it and, quite frankly, they feel it's an investment."
Selph, who deals with residential resale and commercial sales and who recently opened a Spring Hill office, agreed that the parkway's effects are far down the road.
"Why would the anticipation of a road coming up drive up new home sales?" he asked. "It may drive up the speculative value of real estate, but the actual number of new homes being built wouldn't make sense at all."
County Planning Director Larry Jennings agreed, saying he was not surprised by the building permit numbers.
"I would have expected in this time period the growth rate to be fairly close to what it had been," Jennings said. "I don't see an automatic opening of the gates with the parkway. I think it's going to be a steady progressive growth."