Residential construction surging in Santa Rosa County


  • January 25, 2015
  • /   Louis Cooper
  • /   government

Santa Rosa County is in the midst of a residential construction surge, marking the recovery from the Great Recession.

Fiscal 2013-14 saw a $150.6 million in investment in residential construction in Santa Rosa County, the most in a single year in Santa Rosa County since 2006, according to the Santa Rosa County Annual Report to the Citizens, released earlier this month.

That same year saw 1,155 residential building permits issued, the most since 2007.

“We have issued the largest number of permits for the Pace and Holley-Navarre areas,” said Beckie Cato, planning director for Santa Rosa County. “Mostly, these are single family houses with a few townhomes with three or more bedrooms,” she said. “There is currently one 250-unit apartment complex under construction and another recently permitted 148 unit complex that plans to break ground in February. Both are located on (U.S) 98 in Midway and Navarre.”

David Peaden, executive director of the Homebuilders Association of West Florida, said builders across the region are seeing an increase in business.

“The recession ended in 2009, unemployment is down and jobs are returning. It’s been an improving economic environment every year since the recession,” Peaden said.

“The recovery is uniform from Baldwin, Escambia, Santa Rosa, Okaloosa, Walton and Bay counties. Mobile County is lagging a little behind but may improve with new jobs coming to the area.”

SRCconstructionRick Harper, the executive director of the University of West Florida Office of Economic Development and Engagement, said that not only is construction up, but so are home sales. “The average number of new homes sales per month has risen steadily over the last several years, and at the end of 2014 were some 40 percent higher than in 2012,” Harper said. “By the end of 2014, sales per month had overtaken permits per month. Since sales are now at or slightly above permits, inventories of unsold new homes will tend to fall.”

Harper notes that residential building permits issued in calendar year 2014 actually dipped slightly as compared to 2013. The county’s report only included fiscal 2014. Cato said calendar 2014 saw an 8.5 percent decrease.

But Harper said even that is not a bad sign.

“I do not think it is a negative,” he said. “Instead, builders see that the market cannot yet absorb all of the homes that were permitted in 2013 and still maintain some price growth. In order to avoid an oversupply and falling prices, they are cutting back on new permits by a modest amount.

Santa Rosa’s numbers, however, are still way behind the heydays following Hurricanes Ivan and Dennis – which hit the region in 2004 and 2005.

In 2004, the county issued 3,298 residential building permits. The following year, residential construction expenses topped $354 million.

So, the market is still in recovery mode. Peaden said banks seem to be willing to fund individual homes more readily than entire subdivision development.

“A majority of banks and regulators are still hesitant on lending for land development,” he said. “Historically, if the markets continues to get better, the lending will improve also.

Commercial development slower to grow

Also, investment in commercial development has been less dramatic since rebuilding from Ivan and Dennis subsided in 2006.

In 2013, the county saw $25.8 million in commercial construction, the most since 2007 with the exception of 2009. In 2009, there was $146 million in commercial development, but much of that came in the construction of the Blackwater River Correctional Facility and one other project in the Santa Rosa County Industrial Park in East Milton.

 In 2013, however, there were only 36 commercial building permits issued in the county, the lowest number since before 2000 – the furthest back the report shows.

Cato believes more substantial commercial development may be on its way.

“Commercial development follows residential development as a general rule,” Cato said. “It would be reasonable to expect more commercial development to be on the horizon.” Harper believes the residential and commercial construction markets will take off substantially as the overall economy improves. “The two county metro finished 2014 on a high note, with annual job growth coming in well above the long run trend," Harper said. "If this strong job growth continues, then there will be an increased need for new homes and for commercial space.”
Your items have been added to the shopping cart. The shopping cart modal has opened and here you can review items in your cart before going to checkout