Housing Leadership Council

Rents are rising as homebuyers get priced out of the market

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By |South Florida Sun Sentinel Jun 13, 2021
Picture By John McCall, South Florida Sun Sentinel

Unless you can drop a pile of cash on the table, you may get squeezed into renting in South Florida’s crazy homebuying market.

Home shoppers who need a mortgage are finding it harder and harder to land a house when competing against buyers — many from out of state — who are offering huge amounts of cash. That’s driving many people to rent, which only drives rents even higher.

Average rents have increased almost 4% in South Florida in the past year, double the increase the year before. Rents could rise an additional 2.5% to 3.5% in the coming year, according to Ken H. Johnson, a real estate economist at Florida Atlantic University.

RELATED: Homebuyers face stiff competition in South Florida as northerners arrive — with cash »

Kristina Mahon, 35, and husband David, 43, face the typical predicament. They have searched without luck for a home in the Pompano Beach, Margate or Coconut Creek areas. They’ve put in offers on four houses, up to $30,000 over the asking price, but they’ve lost out to multiple cash offers on the same houses.

For now they’re renting a condo at Palm Aire, a condominium complex in Pompano Beach, on a month-to-month basis as they continue to search for a home.

“We were kind of forced into it,” Kristina Mahon said. Their plan is to reevaluate if they haven’t bought a home within six months.

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PBC housing affordability crisis is getting worse. Is a solution on the way?

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By Wendy Rhodes | Palm Beach Post | June 12, 2021

Picture by Meghan McCarthy, Palm Beach Post

For nearly two decades, local government leaders, developers and advocates have brainstormed and promulgated different measures to address a chronic sore spot: Ever-increasing housing costs have made the American Dream of homeownership unattainable for broad swaths of people.

“The dirty little secret is that the issue never got better, especially for people at the lower end of the income scale,” said Suzanne P. Cabrera, president and CEO of the Housing Leadership Council of Palm Beach County. “Even if we took everybody’s wages and doubled them today, Palm Beach County is still unaffordable.”

More:Palm Beach County home prices surge past Broward County. Hottest condo market? Look north.

More:At home on the high seas: housing costs spawn liveaboard sailboat craze

The hurdle has only gotten higher in the past few years, courtesy of a pandemic, frigid winter weather across the northern United States and a new federal tax lawthat have driven more people here, adding to the competition among buyers for homes in a relentless seller’s market.

So,the word is clearly out again:Palm Beach County is a great place to live and work. Just ask the thousands of folks from out of state who are flocking here to retire, raise their families, open businesses or buy second homes to soak up some of Florida’s fabulous winter sunshine.

That popularity has only worsened the already difficult panorama for prospective low- and middle-income homebuyers. As high earners from other states relocate to Palm Beach County, increased housing demand, coupled with limited inventory, are driving up costs. Locals are further being priced out of the housing market, forcing them to commute from other counties, double up with roommates or even move away.

Disturbing home affordability trend

Cabrera’s organization, the Housing Leadership Council, was founded in 2006 to ensure the area has enough affordable housing for the service and mid-level workers who make up the bulk of the county’s residents.

The group works in conjunction with local academics, nonprofits and government agencies to identify the extent of the need for affordable and workforce housing, as well as strategies to tackle that demand. Finding solutions, however, is easier said than done, she points out.

The council right now is tackling an ominous trend for housing. Namely, the county is losing significantly more affordable housing units each year than it is building, and adequate funding to back rent vouchers to meet immediate housing needs is simply non-existent.

To change that direction, the Housing Leadership Council is working on a proposal to present to county commissioners in March about how to address these growing problems….

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The FHA Foreclosure Moratorium Ends of June 30, 2021

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Covid-19 has impacted the world and nation in ways that we could not have imagined. We understand the hardships faced as you are struggling to pay your mortgage.  The FHA foreclosure moratorium that began in March last year comes to an end on June 30, 2021.  While the economy enters recovery phase, many families are currently having trouble recovering from personal and financial challenges.

We encourage affected borrowers to contact a HUD-approved Housing Counseling Agency for assistance.  Under the Cares Act of 2021, a mortgage payment forbearance option provides aid to homeowners who either directly or indirectly were financially impacted due to Covid-19.  The Act provides homeowners with an initial forbearance of their monthly mortgage payment for up to 180 days; and they may qualify for an additional 180 days depending upon their specific situation.  At the end of the forbearance period, FHA has a permanent partial claim/loss mitigation option to assist with repayment. To contact a HUD-approved Housing Counseling Agency at https://apps.hud.gov/offices/hsg/sfh/hcc/hcs.cfm  or call the interactive voice response system at (800) 569-4287.

There are other resources that may offer help. The American Rescue Plan Act of 2021 provided a Homeowner Assistance Fund. This funding is distributed to state and local governments to help homeowners remain in their homes. In addition to contacting a HUD-approved Housing Counseling Agency, borrowers may contact their lender directly to inquire about a forbearance, as well as the Florida Housing Finance Corporation at (850) 488-4197 and their local government.

Having a place to call home is one of the most important things we can do to recover from the ills of Covid-19. For additional information go to https://www.hudexchange.info/programs/covid-19/ or dial 1 (800) CALL FHA.

By the numbers: South Florida’s torrid housing market

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Photo By Carline Jean / South Florida Sun Sentinel

New data shows just how tough it is to buy a home in South Florida.

The region has fewer homes for sale than anytime in the past three years; the median price has increased steadily for a year; and the houses are disappearing faster than anyone can remember, according to data from the Florida Realtors Association.

“There is zero supply, making it challenging for buyers and for sellers who want to sell,” said Karen Johnson, president of the Broward Palm Beaches and St. Lucie Realtors Association.

RELATED: South Florida’s real estate boom: See updated data on some prices, sales and rent »

The trend has been evident for some time, but the Realtor data offers a new perspective. Here’s what it shows for Palm Beach, Broward and Miami Dade counties:

Median sales price

The median sales price for each county has steadily increased, with all three counties hitting three-year highs in April.

In Palm Beach County, the median price in April was $466,000, a 27% increase from the year before. In Broward County, it was $464,000, up 21% in a year. Miami Dade’s median price jumped to $515,000, a 34% increase from last April.

“We don’t expect prices to go down. We’re just hoping it levels off in the next year,” Johnson said.

Cash sales

Palm Beach County had 830 cash sales in April, up from 675 the year before. Broward County recorded 435 cash sales in April, up from 109 the year before. The last time that number came close was about 350 cash sales in March 2017.

RELATED: Homebuyers face stiff competition in South Florida as northerners arrive — with cash »

Miami Dade saw fewer cash sales than the two other counties — 391 — but it was still a significant increase from 106 last year.

In many cases, cash buyers are arriving from the north and making it harder for the average buyer who needs financing, Johnson said.

Homes on the market

The number of homes on the market has plummeted to its lowest level in the past three years.

Realtors measure the market based on how long the supply would last at the current sales clip. Palm Beach County has enough inventory for about 1.8 months, down from 4.2, while Broward County has 1.4 months of inventory, down from 3.9 months last year.

Miami Dade County has a little bit more homes on the market: two months compared with 5.6 months last year.

Quick sales

Houses are flying off the market in a matter of weeks.

In Palm Beach County, the median time between listing and a contract was 13 days in April, compared to 29 days last April.

In Broward County, the median time…

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Can’t find a home to buy? More people are building instead

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By | South Florida Sun Sentinel May 22, 2021 9:00 AM
Photo By: Amy Beth Bennett / South Florida Sun Sentinel

More people are choosing to build their own homes in South Florida as bidding wars push prices out of sight and existing homes remain scarce.

Sales for newly constructed homes have surged 113% compared with last year, according to Zonda Home, a market research company for the real estate industry.

It’s a shift escalated by the COVID-19 pandemic, as a newly built home is seen as a simpler, less complicated option than buying an existing home.

RELATED: South Florida’s real estate boom: See updated data on home prices, sales and rent »

In the current torrid market, buyers of existing homes often are forced into bidding against waves of transplants who are arriving with wads of cash. With new construction, a buyer picks a lot, usually for a fixed price, and can customize the home with a developer from there, explained Tim Costello, CEO of Builder Homesite.

“In a good year, we might see a 10% increase in demand,” Costello said of the desire for new construction homes. “I haven’t seen anything like this in 20 years.”

The scarcity of land for building remains a problem in a region sandwiched between the ocean and the Everglades. Many developers are creating new communities in western Palm Beach County, in cities like Wellington, West Palm Beach, Jupiter and Royal Palm Beach, according to data from Zonda Home. The western areas of Lake Worth, Boca Raton and Delray Beach also have attracted a stream of new developments.

Broward County presents a more difficult challenge, with little open land remaining to the west. Developers are building on former golf courses and polo fields scattered around the county — in Hollywood, Miramar, Tamarac, Parkland and Margate.

Miami-Dade’s new construction is concentrated in Homestead, with other developments in Hialeah and unincorporated Redlands.

Between the three counties, nearly 29,000 homes are planned or under construction, according to Zonda Home:

  • 14,151 in 51 developments in Palm Beach County.
  • 5,360 in 32 developments in Broward.
  • 9,275 in 47 developments in Miami-Dade,

Among the most popular developments, based on sales:

  • E11even Hotel and Residency, Miami.
  • Westlake Community, Westlake.
  • Lotus/Fiji, Boca Raton.
  • Marbella, Miramar.
  • Natiivo Miami, Miami.
  • Sky Cove South, Westlake.
  • Sky Cove, Westlake.
  • Canaris at Downtown Doral, Doral.
  • AquaBella/Harbor, Hialeah.
  • Venezzia, Miami.

“Every one wants a single-family home if they can afford it,” said Brent Baker, division president of Pulte Group. “If their budget doesn’t allow it, then it’s a townhome.”

Building might be cheaper than…

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