A recent Wall Street Journal headline, "Builders See Returning Florida Market," sounded a positive note for the state's long-languishing real estate sector.
The Sanford-datelined story was pegged on a single statistic: a 70 percent year-over-year increase in construction starts for single-family homes in the Orlando area.
But analysts, including the one who reported the increase, caution that one quarterly number does not a recovery make -- especially when that number is built on such a small base.
"When the numbers are small, you can get extreme changes either way," said Jim Lewis, president of Charles Wayne Consulting, an Orlando-based research firm.
The numbers are small indeed. For the first quarter of 2010, the four-county Orlando metro area reported 951 single-family home starts. This barely compares with more than 7,000 starts in the second quarter of 2004. Since that high point, activity has gone steadily downward.
Closings, active projects and median prices also continue down, down, down.
The same goes for multifamily dwellings. Multifamily starts totaled 412 in the first quarter vs. a high of 13,500 in the fourth quarter of 2005.
"More starts this quarter will mean more closings next quarter ... maybe," said Lewis, who added, "some of those starts are pure specs."
Bottom line: If a sustainable housing revival is emerging, it's not in Central Florida.
And apparently not anywhere else in the Sunshine State. MetroStudy reports that the South Florida market remains just as weak.
The research company counted a "shockingly low" 11 (eleven) single-family home starts in Miami-Dade during the first quarter and branded Broward County "virtually dormant for the past two years."
St. Lucie County, once among the top five fastest-growing residential markets in the nation, had a grand total of 13 single-family home starts during the quarter. Meantime, some 6,000 developable lots sit vacant there -- as they have for the past two years.
Analysts say housing starts will remain anemic as long as Florida leads the nation in the percentage of mortgages classified as "seriously delinquent" (20.6 percent, according to the Mortgage Bankers Association).
Still, hope springs eternal for developers and, apparently, for real estate reporters.
Lennar Corp. in February optioned nearly 5,500 residential lots and the Journal reported that the Miami-based builder is now selling homes on those tracts for $160,000 and up.
Other developers are starting to build lower-end dwellings on land that sold for roughly 40 percent below boom-era prices.
But a double-digit percentage gain in construction activity is nothing to get excited about when it's derived from the previous year's numbers that were in the tank.
"Percentages do not buy houses, people do," Lewis observes.
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Contact Kenric Ward at kward@sunshinestatenews.com or at (772) 801-5341.
