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Southwest Florida needs to build more new homes

Southwest Florida needs to build more homesCollier, Lee are lacking homes

JUNE FLETCHER | Naples Daily News

Southwest Florida needs to build more new homes to meet local job creation, a new report said.

After analyzing employment and permits, the National Association of Realtors concluded that there’s a shortfall of 13,609 new single-family homes in Cape Coral-Fort Myers, and a shortfall of 3,020 homes in the Naples- Immokalee-Marco Island metro areas.

Yet that pales in comparison with Florida metro areas such as Miami-Fort Lauderdale-West Palm Beach, which the trade group said had a deficit of 118,937 homes to meet the needs of newly hired workers, or Tampa-St. Petersburg-Clearwater, which had a shortage of 39,034 homes.

Using government statistics, the Washington, D.C.-based Realtor trade group analyzed permits and job creation in 117 metro areas nationwide to determine which places had the greatest shortage of new single-family homes.

The metro areas around New York, Dallas, San Francisco, Miami and Chicago topped the list.

Lawrence Yun, NAR’s chief economist, explained that the recession hurt the housing market by accelerating price growth and making it very difficult for buyers to afford a home — especially young adults.

“Without the expected pick-up in

building as job gains rose in recent years, new and existing inventory has shrunk, prices have shot up and affordability has eroded despite mortgage rates at or near historic lows,” he said in the report.

While building has been on fire in Southwest Florida since the recession ended, the 7,315 single-family permits pulled from 2013-15 in Collier County and the 9,462 pulled in Lee County were inadequate to meet the need, the NAR concluded.

That’s because Lee added 36,683 jobs during the period, and Collier added 16,433.

The ratio of employment over total permits was 3.9 for Lee County and 2.2 for Collier.

Historically, a balanced market has a ratio of 1.6, NAR said.

But 80 percent of markets in the country had a ratio higher than that, indicating they were not building enough homes to meet job creation.

Nationally, the average ratio was 3.4, but some places were much higher than that.

Double-digit ratios were found in 10 metro markets: Trenton, N.J. (25.1), San Jose (21), San Francisco (18.2), San Diego (12.3), New York (12.1), Rockford, Ill. (12.1), Miami (11.4), Reading, Pa. (10.3), Springfield, Mass., (10.2) and Hartford, Conn. (10.1).

Meanwhile, 30 markets had ratios below 1.6, indicating they were overbuilt. But only two had negative double- digit ratios: Danville, Ill., (-12) and Binghamton, N.Y. (-15.3) For home builders, the need to construct more housing is welcome news, even as the industry faces slowing demand in a nervous election year.

A separate report released Monday by the National Association of Home Builders said its index of builder confidence jumped 6 points to 65 in September, the highest level it has been since October.

The index shows builders are optimistic about sales even though they continue to be constrained by shortage of labor and lots, the NAHB said.

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