The pace of new home sales continues to pick up in Indian River County with 363 building permits issued this year so far, compared to about 230 in the same period last year.
The market “feels back to normal,” said Bill Handler, president of Port St. Lucie-based GHO Homes, one of the largest new home builders in the area with construction underway in a dozen subdivisions in and around Vero Beach.
Handler said demand is deepest in the $260,000 to $330,000 range and that he is seeing new home buyers coming from both out of state and South Florida, from cities such as Delray Beach and Fort Lauderdale. He also observed that buyers are moving because of a changed lifestyle, such as retirement or becoming empty nesters, and are “not coming here for the workforce.”
New houses are sprouting from Sebastian to the St. Lucie county line, according to a map prepared by Will Rice of the county’s GIS Department showing new construction.
With national builders such as Pulte, Divosta and D. R. Horton active in multiple subdivisions and building hot spots in south county, north county and along SR-60 near the Indian River Mall, nearly a 1,000 single-family home permits were issued between Jan. 1, 2105, and mid-May 2016, with each new home representing a solid jot of economic activity.
Indian River County Building Official Scott McAdam said there has been a 108 percent increase in single-family home inspections from 2013 to 2016.
“With the permitting increasing, that increases all the inspections too,” McAdam said.
McAdam theorized that the increase in home construction is being driven by newcomers from the North who are spurning the hectic lifestyle of South Florida for small-town living in Vero Beach.
“A lot has to do with Vero Beach itself. People are finding out about Vero. They’re coming from up North, [but don’t want] the hustle and bustle of South Florida,” McAdam said. “Small Vero with nothing happening has changed to something happening with just the right size. It’s becoming very attractive. Not too big. Not too small.”
David Ederer, manager of Navo Builders LLC in Vero Beach, said the majority of the permits are pulled by the big brand-name builders such as Pulte and D.R. Horton.
“What we’re seeing is the larger builders have taken over the market and it has created a dilemma for the small local builders,” said Ederer, who sits on the board of the Treasure Coast Builders Association but does not speak for the association.
Ederer, who does custom house construction, said as a small builder, “We’re dipping our toes into getting back into land development.”
For a number of years after the housing bust that began in 2007, there was no reason to develop new land because there were so many finished building lots available in failed subdivisions, often going for dimes on the dollar. Hedge funds bought up many of them and are now reselling them to builders at prices that keep going up, pushing builders to consider buying, entitling and plating new building sites.
While home construction is not at the go-go rate of the mid 2000s, new home industry observers said the industry is trending upward statewide.
“Things are good. Things are better. Things are improving,” said Doug Buck, director of government affairs at the Florida Home Builders Association.
“Everything is moving forward. But there are some headwinds. One of them is labor. We lost half of our workforce [during the housing downturn of the Great Recession]. We are getting back to where we were, but we don’t have our same workforce so the houses are taking a little longer to build,” Buck said. “A house that should take five months to build is taking six months.”
Handler said Vero Beach developments with strong buyer activity include Serenoa, where prices rant from the $200,000s to the $400,000s; Three Oaks, with attached villas, starting in the low $200,000s; Summer Lake, with homes in the $200,000s and $300,000s; and Lake Mandarin at Citrus Springs, with home selling from the $200,000s to the $400,000s.
Another builder, LifeStyle Homes, is also seeing brisk sales at developments such as Huntington Place near 61st St. and 58th Ave.; 4 Lakes, near 43rd Ave. and 13st St. SW; and Cross Creek Lake Estates on Powerline Road in Sebastian.
“This is the first year for Lifestyle in Indian River County to have a presence in multiple developments, as well as custom homes on buyers’ own land,” said Megan Raasveldt of Dale Sorenson Real Estate, listing agent for Lifestyle in Indian River County.
She noted Lifestyle opened up a model on Feb. 1 and has since sold five homes in Huntington Place. The model is not even completed in 4 Lakes and Lifestyle has two builds underway there. Raasveldt said half of Lifestyle’s business is done on buyers’ own land outside of subdivisions.
She said a lack of inventory is a main driver of the new home construction upswing.
“There were an overabundance of foreclosures that contractors were rehabbing and flipping, but that inventory has dried up significantly,” she said. “So now for an updated home, by the time a buyer purchases a resale home, modifies it to their specifics, the costs and time of construction are almost the same as building from the ground up and getting everything they want [and everything brand new].”