In a region where loads of real estate is still sitting on the market, you'd think nothing could make it worse. You'd be wrong. What would happen if the people who could potentially live in one of those idle homes left the region altogether? A University of Florida study says that’s exactly what’s happening in the Sunshine State.
For the first time since servicemen left after World War II, Florida is losing residents. More than 58,000 people left the state from April 2008 to April 2009, a drop in population from 18,807,219 to 18,748,925.
Stan Smith, director of the university's Bureau of Economic and Business Research, who led the study, pins the loss of population squarely on the economy (which lost 600,000 jobs in the past couple of years). “It’s been mostly the recession and the loss of jobs [causing the population loss] and certainly a lot have been in construction,” Smith says.
The stagnant housing market has also added to the problem, as it's more and more difficult for people who otherwise would want to move to Florida to sell their homes or get a loan to buy a new house, Smith adds. “When people have trouble selling their homes in Ohio and New Jersey, they tend to put off a move,” Smith says. “There were people who might have otherwise moved to Florida.”
Broward County, Lee County, and Palm Beach County recorded the largest population losses in the state, with 13,904, 8,601, and 8,033 fewer people, respectively. “Incomes are going down and people are losing jobs,” says Jack McCabe, president of McCabe Research and Consulting, a real estate consulting firm based in in Deerfield, Fla. “We’re not creating any jobs. There are 9,000 empty [condo] units in Miami. Who is going to fill them up?”
While Florida has been adding 3 million new residents a decade since 1970, Smith doesn’t expect that pace to return anytime soon. “In general, jobs tend to recover a lot more slowly after a recession than do some other economic indicators,” Smith says. “I would guess that growth is going to continue to be slow in Florida for another year or so and then start to pick up as we go out into the next decade.”
But Smith does think the state will record positive growth going forward. Adam Cappel, president of CondoReports.com, a Miami research firm agrees. “As the economic picture starts to turn, it will draw people back, particularly now that housing affordability is near historic levels,” he says. “When the economy starts stabilizing, it will suck people back in because the quality of life is great.”