Polk County Housing Market Declines Further

The year started off the way 2006 ended in Polk County.

That meant declines in the Central Florida housing market but yet another strong performance in the region’s job market, according to The Lakeland Ledger’s monthly Polk County Business Barometer.

The county logged just 249 permits for new home construction in the month of January, plunging 76 percent from 1,039 in January 2006.

It was the lowest monthly permit total since March 2001, according to records kept by The Ledger, reflecting just how far Florida mortgage activity has fallen off since the boom of 2001-2005.

“I think the permits are still being distorted by that rush home builders had to beat the implementation of the higher impact fees,” said a local economics professor, Carl Brown, referring to the local flurry of permitting activity starting in late 2005.

But Brown, of Florida Southern College, was quick to point out that last year’s elevated home construction activity led to a glut of inventory, which has dragged on home sales.

In fact, Polk County’s existing home sales totaled 282 in January, down 30 percent from 403 the year before. That figure was the lowest total since January 2002, according to Ledger records.

Lakeland’s 162 homes fell 31 percent from the previous year’s 236, while East Polk had 116 homes sold, down 28 percent from 161. Bartow had four homes sold, compared with six last year.

Despite those declines, Lakeland Realtor Brooks Chandler noted that the softer market has helped temper prices for potential buyers, who still enjoy the benefit of low Florida home mortgage rates.

In the job market, Polk County recorded a 3.6 percent unemployment rate for January, up from 3.5 percent the year before, and 3.1 percent in December.

The county also added some 5,200 jobs from the previous fiscal year, with the most growth occurring in professional and business services industries, as well as education and health services, and local government.

Polk County economist Gordon Kettle said the uptick in the county’s jobless rate likely signals an upcoming economic slowdown of sorts, but called the data “quite favorable” overall.

Taxable retail sales were $649.8 million in November 2006, the most recent month available from the Florida Department of Revenue. November’s figure reflects a decline of about 3.5 percent from $673 million in 2005.

The decline in retail sales, coupled with a lag in housing sales and slow Florida mortgage loan demand, also suggests a slowdown, economists predict.