President Barack Obama is in Fort Myers, Florida on Tuesday,
February 10, holding campaign-style events to promote his
emergency economic stimulus bill. Scheduled to appear with the
President was Florida's Republican governor, Charlie Crist.
It's an understandable choice of location for a President
focused on convincing the public of the need for immediate
action: Florida's economy is bad, and getting worse.
The New York Times' front-page headline for a story
highlighting Fort Myers was
In Florida, Despair and Foreclosures" (registration
required). The statistics were grim: Median home prices
dropping from $332,200 in December of 2005 to $215,200 in
December 2007 — and then plunging to $106,900 two
months ago; 8.8% of the county's jobs disappearing between June
2007 and June 2008; and unemployment rate of 9.85. And the
anecdotes were troubling: foreclosed homeowners struggling to
find temporary accommodations, long lines forming for free
bread, and laid-off construction workers rummaging through
trash bags at a foreclosed home, looking for anything to
In a real estate market that has fallen farther, faster, and
harder than any in the nation, Floridians are searching for
clues that they may be nearing the bottom. In Miami-Dade
County, builders started just 72 new homes in fourth-quarter
2008, down from 240 in the third quarter, the
Miami Herald reported.
In Broward County to the south, there were just 13 starts (down
from 203 in the previous quarter) — a number close
enough to zero that the difference hardly matters.
Starts are down throughout South Florida for the 14th
quarter in a row, reported the
South Florida Business Journal
Total starts for 2008 were just 3,903, down from 27,444 at the
peak in 2004 and 2005.
Data for both the South Florida Business Journal and the
Miami Herald story came from
a real estate consulting firm. According to Metrostudy, central
Florida is one of the most overbuilt places in the U.S., with
more than a 9-month supply of finished new homes standing
vacant at the current pace of sales.
But there is at least a small silver lining, reports the
: for the lucky few able to secure a
mortgage, home prices are becoming affordable — even
to working people who had thought that owning a home was out of
reach. For those who can scrape together a down payment, buying
may even beat renting. And with prices off more than 40% from
the peaks of two years ago, said one real estate agent, there
are "a bunch of investors running around town with cash"
looking for bargains.
Can the Obama stimulus turn Florida around? Maybe not, but
it could cushion the fall. In interviews last week, the
President focused on
as a centerpiece of his job-creation
effort. That would dovetail well with Florida Governor Crist's
focus on energy: Crist signed an executive order last year
mandating a 15% upgrade in the state energy efficiency code for
new homes. And energy expert Philip Fairey, of the
Florida Solar Energy Center
, argues that a program of
energy upgrades for existing homes — which Obama is
now pushing — would be a better energy investment than
offshore drilling in the Gulf of Mexico.