Brevard County Poised for Florida Housing Market Boom
A decade ago, South Florida home builders moved into St. Lucie County, offering $80,000 homes to middle-class buyers unwilling to pay Palm Beach County home prices.
Now there’s a new frontier: Indian River and Brevard counties, where land is plentiful and cheap and construction approvals relatively easy to get.
“Indian River and Brevard have become the logical next step along the way,” said Greg McBride, a senior financial analyst with Bankrate.com, a North Palm Beach financial information company. “Home values are much more reasonable up there than they are in [the South Florida housing market], and it’s a slower pace of life for people who desire that sort of thing.”
DiVosta Building Corp. of Palm Beach Gardens has communities in Vero Beach and Palm Bay, south of Melbourne. Miami-based Lennar Corp., one of the nation’s largest builders, has two projects in Vero and five in Brevard. Shelby Homes of Fort Lauderdale and GL Homes of Sunrise are building in Vero.
There’s virtually no land left in Broward and Palm Beach counties for large subdivisions, a result of South Florida’s building boom during the past 20 years. Even St. Lucie’s secret is out, although it’s not as much of an affordable alternative these days because Florida home prices have soared there, too, during the past five years.
By contrast, Indian River and Brevard remain largely undeveloped. Besides less-expensive land prices, building impact fees are cheaper, allowing construction of more reasonably priced homes for Florida mortgage borrowers, said Anthony Trella, an industry consultant in Deerfield Beach.
“Long-term, absolutely, this is a trend,” he said. “It’s inevitable.”
DiVosta is building two-bedroom homes in its Lakes at Waterstone development in Palm Bay for little more than $200,000, while three-bedroom homes start at less than $300,000.
Nearly identical homes in parts of Palm Beach County would cost $350,000 or more, said David Koon, a division president for Pulte Homes, which owns DiVosta.
South Florida builders also are attracted to Indian River and Brevard because there are no affordable-housing requirements similar to what’s in place in Palm Beach County, said Joshua Fowler, executive vice president of the Gold Coast Builders Association.
Last year, Palm Beach County commissioners passed a zoning ordinance that requires builders to make, on average, 16.5 percent of new homes affordable in developments with 10 or more houses. That means some of the homes have to sell for between $164,000 and $304,000, based on the county’s median household income of $48,099, according to the U.S. census.
Fowler says the new rule is too restrictive, causing builders to flee for other areas. “It just makes it a whole lot easier to go to a different county and make money,” he said.
Shelby Homes has sold the 96 townhouses in its Bradford Place project in Vero and now is turning its focus to Millstone Landing, a 613-unit, single-family home community under development.
A mix of families and Baby Boomer retirees have expressed interest in the projects, eager to distance themselves from high prices and sprawl in the Broward housing market and Palm Beach counties.
“They’re looking at it like a lifestyle choice,” said Jason Shelley, co-owner of Shelby Homes. “It’s a beautiful area, and there’s a lot of potential for growth up there.”
With new-home sales sagging in South Florida and prospects dim for an immediate rebound in terms of Florida home mortgage demand, some builders are canceling plans to buy property in Florida altogether, including Indian River and Brevard. Still, the Space Coast, which is the Melbourne and Palm Bay areas,remains a target for DiVosta during the next five to 10 years, Pulte’s Koon said.
“Indian River is pushing back a little bit on growth right now,” he said, but Brevard County and Palm Bay “have been very gracious toward us and supportive of the type of growth we want to bring.”
SOURCE: The Sun-Sentinel
