Prices
in the Florida Keys and Key West are not unlike
another real estate "hot spot" found on the very
trendy East End of Long Island. Soaring house prices,
a shortage of land, and a lack of low cost and
moderate price housing are similar for the Florida
Keys and the Hamptons of Long Island.
The
reader could substitute "Florida Keys" in place of the
words "East End" and think they were reading an
article published in the Florida Keys Key Noter or Key
West Citizen.
A New
York Times article dated February 13, 2005 reports
that house prices are "bolting into the stratosphere."
So high are prices that the town is unable to assist
in the purchase of houses for "affordable housing" use
for qualified buyers. The Times quotes various
realtors,
"The
East End and East Hampton in particular have lost
gravity."
"Whatever
goes up, goes up, up, and further up."
"The
land has gone. There is no land. It's simple supply
and demand. With a small and eventually nonexistent
inventory, if I've got it and you want it, you're
going to pay whatever I tell you. And unlike
Florida and most of the United States where you can
go north or east or west, there's no where else to
go in the Hamptons. We're surrounded by
water."
Buying
a house is approaching "Mission
Impossible"
".
. . eighty percent of the year-round residents on
the East End (of Long Island) could not afford the
house they are living in now".
".
. . exodus of young people to hire."
".
. . small business owners can't find people to
hire."
"School
districts are having a harder time finding teachers
because they can't live here."
"
How are you going to find people to work on Main
Street if they can't find a place to
live?"
The chart
below shows sales price for single-family home in East
Hampton, New York, a real estate hot spot not unlike
the Florida Keys and Key West. Inflation adjusted
median home sale price in East Hampton Town rose from
$274,000 in 2000 to $625,000. in 2004. The median
price for a home in the Keys for 2001 was $285,840. By
2004 the median price was $557,000.
ELSEWHERE
IN THE NATION
The
New York Times of March 1, 2005 reports that a "Boom
in Prices Brings Investors to Home Sales".
The
article quotes sources as stating ,
"in
Miami the figure is 11 percent" for mortgages taken
out by speculative investors who did not plan to live
in the houses themselves. Other real estate spots
which are "white hot" are San Francisco with 8.5
percent, and Pheonix with 12 percent.
What
is causing this rush into real estate as an
investment? Investors are piling into the market
because of past price rises and anticipated future
sales price rises. In the hot realty market of Los
Vegas the price of a median home between the fourth
quarter of 2003 and 2004 increased 47.3 percent. In
Sacramento the price increased 31.5 percent. In San
Diego the increase was near 25 percent.
In
Florida the Tampa-St. Petersburg area showed a 14.6
percent increase, and in central Florida Orlando's
prices increased by 21.7 percent. Prices increased
over 25 percent for both Miami and the Fort Lauderdale
areas.
