Housing Starts in Broward and Palm Beach Head in Opposite Directions

How can you tell if your city’s housing market is in solid or rough shape? The number of housing starts in the area is, well, a good start. If nothing new is being constructed, it’s probably a sign that Florida home loans aren’t in heavy demand.

Take the contrast in construction around Broward County and Paml Beach. Despite all the talk about a dearth of buildable land in South Florida, the former recorded an increase in housing starts during the second quarter.

The Broward housing market enjoyed 900 starts, up 54 percent over the second quarter of 2005, according to a report released last week by West Palm Beach housing analyst Brad Hunter.

“I don’t know specifically what explains it,” Hunter said. “But land is scarce - that story hasn’t changed.”

On the opposite end, Palm Beach County’s 1,508 home starts in the second quarter represented a 36 percent decline from that period last year. This goes along with affordable housing problems in the area, as prices have been forced to decline in the sector in order to help buyers find a reasonable Florida home loan.

Others tidbits from Hunter’s Metrostudy consulting firm:

- There were 1,621 people moving into homes in Palm Beach County during the second quarter, down 8 percent from the first quarter of 2006. Hunter said he expected more, given the increase in supply of homes being sold by investors. New strategies by sellers and incentives aimed at those seeking Florida home loans should help in the future.

- Broward has 2,724 finished vacant homes and homes under construction, which represents a 16-month supply of inventory.

- Palm Beach County has 653 finished vacant homes, which equates to a one-month supply. That’s the lowest in South Florida, but it’s still rising.

“In the short term, there’s a competitive problem for sellers,” Hunter said. “In the long term, once we work through this, we’ll return to an undersupplied market.”