When was the last time you sat down and reviewed your household budget? Did the fact that you are missing a savings account and some vacation funds cause you to crunch numbers in an attempt to find a way to begin saving? Join the national masses, and welcome to the new culture where Southwest Florida is not spared.
As a real estate developer, it is part of what makes me an expert to understand real time demographics, employment markets, income levels, inbound/outbound migration, and a million other factors I research on a daily basis. Here is the truth based on years of keeping trends, statistics, and being involved in local government. It's great news for real estate investors. Bad news for the renter.
Buzz kill: If you are a renter, there is a 70% chance you are considered "rent-burdened". As defined by HUD, being rent-burdened is when you pay more than 30% of your income on housing. Are you a parent? Maybe worse. Are you a SINGLE parent. The average American pays more than 30% of their income on childcare. If you don't have kids, there is a good chance you are under the age of 35 and earn less than $45,000 per year, which means the most you should be spending on housing is $1,125 a month. Add water, electric, cable, and WiFi to that and your housing costs go way higher than that.
Drive around Lee County and you will find that apartment complexes are going up rapidly. Starting rental rates are $1,250 on average for a newer 1 bedroom. Aren't apartments supposed to cater to those who can't afford to purchase housing or at the very least cater to the young professional? Not today they don't. Rent rates are the highest they have ever been in Lee County and they are expected to continue to increase. Why? It's because you pay for it because you have to just like everyone else and the result is that Lee County currently ranks in the Top 5 nationally in Apartment occupancy rates at 97% combined with the fact that Lee County is one of the most popular migration MSA's in the land.
So, why do people continue to move to Lee County and stay? For starters, the climate and environment is nice. Technically, we still have a lower cost of living than most other metropolitan areas.
That said, this is the new culture for you in Southwest Florida. The culture is that you will continue to live here and continue to be expense-burdened because 1) It's too expensive to move. 2) If you moved, you have to find a new job and you could have a financial crisis if you don't get next weeks paycheck. 3) You don't want to start over.
As a member of the Construction Advisory Board for the Lee County School District, part of my job is to explore ideas on how to make the School District better and one of the biggest topics today is teacher retention. The issue is clear. Lee County has a massive annual turnover issue among teachers and that is not a good thing. What's worse is that this turnover issue costs us taxpayers over $20 million per year. One in ever 5.8 teachers quit or retire each year. That number should be closer to 1 in 20. According to a recent internal study by the District, two of the top three reasons for this is unaffordable housing and lifestyle. It was concluded that the issue with lifestyle came to light because many teachers have to live in very rural areas just so they can afford housing. Far from friends, restaurants, entertainment. There is no life beyond waking up and driving long distance to work everyday.
I wish I could tell you help is on the way. I have been lobbying Public entities in Lee County for a year to engage in public / private partnerships in an effort to solve the attainable housing crisis. Sadly, bureaucrats have not dedicated serious time for it. It's too complicated for them. This is while most local public entities like the school district are drowning in debt service. The double whammy is that the East district desperately needs a new High School. Funding is nearly impossible until the District relieves some of its current debt.
As a member of the community, it is your civic duty to be part of the solution if you want to see housing justice. The last time a comprehensive fiscally conservative "attainable housing" solution was proposed, the media was all over it, pushing it as a very positive story. Yet, the public backlash was so negative, it caused the public entities involved to rescind their effort to pursue because board members likely don't want to risk an election year and are afraid to go beyond the status quo.
Those in the community who opposed this probably did not even know what they were complaining about. They didn't understand that none of the proposal included funding via taxpayer dollars. Guess who suffers? Those who are members of the community who are drowning in debt. Eventually, if nothing is done, this is going to have a massive effect on every single taxpayer in the area and eventually have a negative effect on the housing market if Lee County becomes labeled as unaffordable.
The culture is real and you are part of it. Please offer your thought comments. They are much appreciated and always responded to.
As always, if you are a potential home buyer or seller, we would like to offer our expertise service in real estate to give you the most detailed analysis so you can get yourself a great deal. We aren't your normal real estate agent. We are licensed realtors (since 2004) through Royal Shell Real Estate, successful residential developers, and experts in real estate finance. We are licensed realtors through Royal Shell Real Estate.
Allan Development Group - President