Real estate in Northeast Florida is as hot as a typical July afternoon — with heated demand and sizzling prices in many cases and in most places.
“It is a hot market,” says John Holbrook, an agent with Berkshire Hathaway Chaplin Williams Realty on Amelia Island.
If they could, the numbers would speak for themselves. Nassau County is ranked within the top 100 fastest-growing counties in the U.S., while Nocatee (in St. Johns County) is annually listed as one of the fastest-growing communities. And commercial real estate is active and well, evidenced by the steroid-like growth around the St. Johns Town Center involving global/national titans like Hines and Simon Property Group.
And for tiny Nassau County to be represented nationally brings credence to what is happening here. “When I heard it, it surprised me,” Holbrook says about Nassau’s accolade. “Because it’s a big country.” (There are more than 3,000 counties in the U.S.)
In Nassau County alone this year, the total sales of single-family homes have eclipsed $1 billion. However, to be accurate, the sales number is actually half of this amount (because a sale counts for both the buying and selling agents). But still, the numbers are big.
Regardless, “I don’t see a bubble,” Holbrook says. “I don’t think prices are aggressively going up.”
Everyone remembers the real estate meltdown that began in 2007 and engulfed every financial market in the U.S. While home prices have rebounded back to the levels of 10 years ago, they are more realistic now. Time has a way of doing that.
In Nassau, this time it is even bigger than the peak time of the market 10 years ago. For instance, the total sales here in 2008 were $175 million; this year, they are over $500 million. “I can tell you right now, that wasn’t the peak,” says Holbrook. “Right now is the peak.”
A lot of the growth here is tied to the explosive development of Yulee. And to think that the massive Rayonier housing/commercial/industrial projects are only in their infancy. The numbers could be exponential.
“I think a lot of it is that there’s just more product,” Holbrook says. “Because the average sales price is largely unchanged over the last 10 years.”
Even though the sales numbers in Nassau are quite impressive, they are pretty much on pace with last year. Meanwhile, the inventory of available homes here has steadily declined.
“It is healthy because you don’t get over-saturated,” Holbrook says. “People who come here to look have an urgency to buy because of the limited inventory. It also pushes prices upward, which helps the tax base.”
Right now, there are 489 homes for sale in all of Nassau County, with 191 on Amelia Island. (These numbers do not include condominiums or townhouses, or by-owner listings.) But it’s still “real low,” according to Holbrook. On average, 125 homes are sold per month, which means less than four months of inventory is available.
“You can run out of inventory real quick,” Holbrook says. “That is definitely a healthy market.”
There is a subtle downside to having a small, limited inventory of homes. There just aren’t as many homes available to potential buyers in any particular area of the county, in any particular price range.
“When people come and the inventory is that limited and they can’t find what they want, some wait, and others move onto another area,” Holbrook says. So there is a price for success.
The resiliency of Northeast Florida real estate is downright remarkable. Despite two major hurricanes, despite rampant road construction, despite uncertainty in the political arena, the property market marches on here (and in many parts of the U.S.). It’s similar to what is happening in the raging U.S. stock market.
“It doesn’t always make sense, but it keeps chugging along,” says Holbrook.
Around here, there is still a dichotomy between Amelia Island and off island, including the west side of the county. There is a paucity of empty land on Amelia Island, but a plethora of it on the mainland. So most of the new homes are being built in Yulee and in Callahan.
While big-ticket home prices have become grander than ever, the biggest sellers are in the lower price ranges. Homes priced under $300,000 fly off the shelf on Amelia Island and in Fernandina Beach. The prices in this range have risen 20 percent over the last year, as demand has significantly outstripped supply.
The Old Town portion of Fernandina Beach has “been selling like crazy,” according to Holbrook, especially vacant lots there. The historic downtown district in Fernandina Beach has little for sale — with big prices. New townhouses to be built a few blocks from Centre Street are pre-selling for more than $500,000, for instance.
And there are tasty sprinkles of commercial activity in downtown. A new plant is planned for the Rayonier Advanced Materials property, and several older buildings are being renovated. The Old School House will be converted into a boutique hotel, the former Fred’s building has been retrofitted into a trendy grocery store, and H&H Tire is being remodeled. In addition, a microbrewery is being eyed for South Eighth Street.
On the south end, home sales on Amelia Island Plantation have been steady, eclipsing $100 million this year. Wealthy buyers of these higher-end homes often pay with cash, so financing is not needed (eliminating the risk of foreclosures if the housing market experiences a downturn).
Younger buyers are gravitating toward more affordable homes off the island. New subdivisions are springing up like springtime azaleas in both Yulee and in Callahan — centrally located for those commuting to Jacksonville. This same trend prevails in other parts of Northeast Florida, where new homes priced under $400,000 are selling the fastest and seeing the highest price increases.
While the flourishing tourism industry here constantly brings in prospective buyers, the high-quality healthcare system within Northeast Florida also is appealing. Especially as some parts of the area (like Amelia Island) transition into retirement communities.
“It’s a bigger selling point than I would have thought — our proximity to hospitals and healthcare,” Holbrook says, not to mention our amenities like scenic beaches and marshes and waterways. And our picture-perfect climate, even with those steamy days in July.