Brevard County Housing Market Slump Hurts Builders
The pain in the Brevard County housing market isn’t limited to Realtors and people trying to sell homes. Construction workers also are getting hurt.
A big chunk of its construction jobs have been lost during the past year, as a result of the slumping Brevard County housing market.
The number of local jobs in construction, mining and natural resources fell to 17,100 in June, down 1,500 jobs from 18,600 jobs in June 2006.
However, local home building officials estimate the local job losses in construction may be much steeper.
The extent of the loss of construction jobs has gone relatively unnoticed, because many laid-off construction workers have gone back to mostly lower-paying jobs they held before the housing boom, or they have moved to jobs in other states where the housing market is more active.
“A lot of the jobs migrated to Tennessee, North Carolina, South Carolina and Georgia,” said Franck Kaiser, chief executive officer of the Home Builders & Contractors Association of Brevard.
Those states “didn’t have the big price run-ups that we had” in home prices during the boom years.
Brevard’s unemployment rate in June was 4.1 percent, up from 3.4 percent a year earlier, according to state labor statistics.
Another reason why the construction job losses have not had a bigger impact on local unemployment and economy is because many of the jobs were filled by undocumented immigrants, who tend to move where jobs are available.
Dave Armstrong, head of the Florida Home Builders Association and owner of Armstrong Custom Homes in West Melbourne, didn’t have an estimate of how many undocumented immigrants work in construction locally.
However, nationwide, they account for as much as 30 percent of the construction work force, Armstrong said.
Even big builders haven’t been immune to the slowdown. Mercedes Homes, the area’s largest home builder, recently reduced its staff by closing its Palm Bay office and moving some of those workers to its headquarters in Suntree.
“We recently merged our Space Coast and Palm Bay divisions in response to reduced demand in the current housing market,” said David Barin, president of Mercedes’ Space Coast Division.
“Like other home builders, we have had to lay off and transfer some employees as the industry searches for equilibrium.”
Meanwhile, number of Florida mortgage foreclosures in Brevard has continued to rise, with 385 foreclosure filings in June - the most for any month in at least 5 1/2 years, according to the Brevard County Clerk of Courts.
During the first half of 2007, there were a shocking 1,975 Florida mortgage loan foreclosures filed with the clerk’s office, compared with 1,144 for all of 2005 and 1,868 for all of 2006.
As tough as the local housing market may be, conditions are less stable elsewhere in the state, such as the Southwest Florida housing market.
Forbes magazine recently named Miami and Orlando as the nation’s two riskiest housing markets. Rounding out the five riskiest were three California markets - Sacramento, San Francisco and San Diego.
Alan Hunter, a housing market analyst with Metrostudy in West Palm Beach, expects housing prices in South Florida to continue to fall for another year - in some places as much as an additional 20-30 percent - stemming from artificially inflated prices and an excess of home construction.
Follow the link to continue reading this Florida Today article about Brevard County home builders …
