Thursday, June 29, 2006

Soaring Real Estate Prices in Florida

Soaring real estate prices, competition for land, shrinking grants for faith-based housing projects and the rising costs of construction have nearly crippled efforts by South Florida churches to boost home ownership among low-income residents.

It's getting more difficult every day.

We're here to help with affordable housing, but we can't do it because of the high price of construction and land. It's getting pretty ugly.

The Nehemiah Project, named after the Biblical figure who rebuilt Jerusalem in the fifth century B.C., has reconstructed 80 single-family homes in Florida City. By offsetting construction costs with government grants and free labor from church volunteers, the group was able to sell four-bedroom homes for $160,000 each, Azan said. Similar new homes in the area are selling for more than $400,000.

But recently, the major source of Nehemiah's grant money has all but dried up, Azan said. The group received just $20,000 in Miami-Dade County grants this year, compared to an average of $100,000 in previous years.

As one of several faith-based housing developers in South Florida, the Nehemiah project's plight is not unusual. Community activists say faith-based groups have been overwhelmed by the rising demand for low-income housing at a time when many of them can no longer compete with commercial developers for land and building contracts.

Community development corporations aren't producing units fast enough.

You can't just rely on the faith-based community to do that which the private sector and government ought to be doing. It just isn't going to work.

QUALIFIED BUYER

Belinda Floyd, 54, a secretary with Mount Bethel Human Services in Fort Lauderdale, turned to a faith-based group after struggling to save for a home on an annual salary of $26,000. The city of Fort Lauderdale referred her to New Visions CDC, a faith-based group in Fort Lauderdale with home buyer education classes and several affordable housing projects in Broward.

Through the church-based program, Floyd qualified to buy one of 19 houses in Roosevelt Gardens, developed by New Visions in conjunction with Lennar Homes, a private developer. The houses cost between $130,000 and $200,000.

Floyd, who now lives in a rented apartment with her 76-year-old mother, picked a corner lot and applied for county subsidies to defray the down payment with the help of the church. She plans to move into the three-bedroom house in October, if the county grants come through.

They were very encouraging. They always said, "Don't worry about a thing. God has the last word."

Jacqueline Tufts, executive director of New Visions, said enrollment in the group's monthly home buyer's class -- the first step toward getting one of the lower-priced houses -- has risen in recent years. At the same time, affordable contractors and properties have become scarce.

It's been very difficult finding builders that will complete the projects within our budget. We're still keeping it affordable only because of subsidies.

But federal grants that keep prices low are diminishing. The U.S. Department of Housing and Urban Development has cut grants to faith-based organizations in recent years, according to a study conducted by the Roundtable on Religion and Social Welfare Policy at the Nelson A. Rockefeller Institute of Government.

Religious leaders say housing has become a pressing concern among congregants. The median price of a single-family home in South Florida jumped from $150,000 in 2000 to $340,000 in 2005, according to a Miami Herald analysis.

The Rev. Henry Nevin of St. John Institutional Missionary Baptist Church -- once a thriving Overtown congregation with more than 2,500 members -- started a faith-based community development corporation more than 20 years ago to provide affordable housing to neighborhood residents. The church has helped build more than 40 homes and apartments, and is nearing completion on 14 town houses on 16th Street and Northwest First Avenue. The pastel houses, which sit on a barren street across from an FPL power plant, are priced between $115,000 and $139,000.


PAST FAILED EFFORTS


Some faith-based housing projects fail due to mismanagement.

In 2002, Miami officials cut funding to several home ownership programs when groups failed to produce enough new properties. Among the groups that lost funding: Word of Life Community Development Corp., a defunct faith-based group that took in hundreds of thousands of grant dollars to build houses and renovate storefronts around Overtown and Liberty City. The group built only two houses.

The BAME Development Corp., a faith-based group affiliated with The Greater Bethel African Methodist Episcopal Church, never finished a 40-unit building called New Hope Overtown, although the group's former executive director collected close to $400,000 in administrative funds over several years while ostensibly overseeing the project.

The group's past failures have made it harder to get grants, said Don Patterson, BAME's new director. BAME now plans to complete 745 units of affordable rentals in Overtown and Little Haiti by 2009.


AN OPTION TO COMPETE


Some experts say faith-based community development corporations, which first came about in the 1970s and flourished in the 1990s, may have difficulty surviving the spike in real estate prices.

In a tight housing market, it would be very difficult to start or sustain a faith-based development effort.

Leaders of some faith-based groups say they are considering raising prices to compete with the open market.

David Alexander, president and CEO of St. John's Community Development Corp., said the group's board is discussing whether to build affordable or market-rate units in a planned housing and commercial project on Third Avenue in Overtown.

Units in the $70 million, twin-tower apartment and shopping complex would sell for $150,000 if priced as affordable, or upwards of $250,000 if sold at market rate, Alexander said.

In Fort Lauderdale, New Visions has plans to develop mixed-income properties to offset the cost of affordable housing.

We have to keep up with the market. That's the only way we can stay afloat.

4 Comments:

Blogger Kely said...

Hello I want to congratulate to you. This site is fantastic, looks like entertained and very good to me it elaborated. I invite them to that they explore a little on my site of the Web
Our real estate listing includes great opportunities on Costa Rica Central Valley’s provinces such as San Jose, our Capital, with remarkable cities as Escazu at the west, or Curridabat at the east, experiencing a great development on both commercial and residential properties, making their real estate pricing highly attractive to investors; on other hand, Alajuela city gathers places with a very special warm weather such as Grecia, La Garita and Atenas, or beautiful farms for agricultural, cattle or nature preservation purposes as those located on San Carlos or Sarapiqui. We also offer land properties in Guanacaste, which is the province, along with Puntarenas, with the most beautiful tropical beaches on the Pacific Coast such as Tamarindo, Playa Grande, El Coco, Playa Hermosa, Nosara, Samara, Herradura, Jaco, Manuel Antonio, Dominical and Golfito, where the real estate business occupies the first place as the local economic activity.
Great investment opportunity at Costa Rica Pacific Coast, Preconstruction condos in costa rica
Condo sales in costa rica, Retirement property in costa rica. Visit us for more info at: http://www.costa-ricarealestate.com/

3:14 PM  
Blogger Kely said...

These articles are fantastic; the information you show us is interesting for everybody and is really good written. It’s just great!! Do you want to know something more? Read it...:Great investment opportunity at best western jaco beach, best western jaco beach resort ,beach front hotel jaco puntarenas. Visit us for more info at: http://www.jaco-bay.com/

1:39 PM  
Anonymous Anonymous said...

Hey, since you're not posting about the Miami Housing Bubble any more, why not send people to the following website that is current and up-to-date:

South Florida Housing Bubble

6:29 PM  
Blogger cottasofia said...

You have give good information. Thanks for taking the time to discuss this, I feel strongly about it and love learning more on this topic.Good article.

__________
Miami Title Company

3:50 AM  

Post a Comment

<< Home