Finegan Eagle
Our City of Gulfport and its character are not about housing stock and commercial facilities, but about our people, its diversity, and its charm. What is our city is about art, food, drink, attention and pride in our strangeness. What I see over the past two years is an affordability gap for these people who have created our charm and quirkiness. Many people approached me and asked me, Why?
Here are some answers: home insurance is increasing; high demand for goods and low inventory of goods; proximity to water; limited terrain; low mortgage interest rates over the past five years; remote work from home issues; the cost of building materials; and supply chain issues.
I believe our three biggest are:
Issue 1: Business and investment purchases for profit through vacation or seasonal rentals. Some examples of rising rents in Gulfport are Airbnbs, short-term leases, second and third home options, and pure investment properties.
Question 2: Migration from north and west to Florida. Three causes of this migration are the climate, the cost of living comparable to where they come from and the low taxation in Florida. Two major effects of this are their ability to pay above the market rate and their willingness to pay above the market rate.
Issue 3: Population growth in all social categories. Here are some interesting numbers. On the Wall Street Journal’s real estate page, Nicole Friedman reported that as of February 1, the national median cost of a home was $397,000 and the national median cost of a home was higher than the national median income. On average, Tampa Bay buyers paid $27,000 more than asking prices, according to an article in the Tampa Bay Times. For the year 2020-2021, 53.3% of home buyers are paying cash. At the municipal level, the Times also reports that rental prices rose 16.3%, as well as 43% above the asking price. Finally, The Times reports that regionally, homes are selling for 18.8% above asking price in 2021, the highest since 1987.
So, let’s explore all of the potential options for a potential affordability fix. I want to point out that I don’t agree with all the options, but here they are:
• Land bank
• Remove monthly leases
• Rent control or rent stabilization
• Zoning changes such as zoning for multi-family units
• Limitation of business or investment structure
Current figures are 79% for the year 2020-2021 for pure investment purchases, an increase of 533% since 2011, The New York Times reported last month. With the rise in rents, we are now seeing individuals who bring us charm leave, so could this be the beginning of the charm exodus? Our city is the people who live here, not the buildings we live in, and if we can’t afford to live here, it won’t be what it is.
So, let my favorite real estate agent (Stacey Purcell) say, “Location, location, location!”
Your neighbour,
Ian O’Hara
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