Read Full Article: By Stuart Korfhage
While home building leaders in Northeast Florida can’t predict all of the results from the rise in residential impact fees, they are sure about one thing: Buyers are going to pay more.
Days after the St. Johns County Commission voted to implement a new fee schedule for residential and commercial construction, industry leaders voiced their concerns about what will happen.
Joe Blanco, division president of ICI Homes’ North Florida Division, said the higher fees — increases of about $1,500 to $9,600, depending on the size of the home — are going to add a lot of pressure to the local market.
Even before the new fees go into effect, which will begin to be phased in July 1, St. Johns County already had high home prices compared to the surrounding area. According to the Northeast Florida Association of Realtors, the median home price in this county (new and existing) for 2017 was $312,500 compared with $180,000 for Duval; $189,000 for Clay; and $229,000 for Nassau.
ICI builds in all of those markets, and Blanco said some buyers might start looking at places other than St. Johns County when shopping for a new home.
“It’s still a great county, and the schools do so much for you where people want to be there,” Blanco said. “It’s still tough when you try to explain why they’re paying so much more compared to outlying counties. That’s still a little bit of an issue there.
“On the developer side, you have a lot more developers looking at Clay County and Nassau County now because St. Johns County’s prices are getting so high. To have a first-time home buyer in St. Johns County is kind of getting tough. It’s getting tough to meet that price point where they can afford it.”
Chris Dostie, president of Dostie Homes and president of the Northeast Florida Builders Association, said he’s also concerned about any additional costs passed on to the customers.
“Every time a home price is raised, it eliminates somebody from the marketplace,” Dostie said. “The increase is significant. It’s something that ultimately the end user, the buyer, is paying for.”
Blanco said the fee increase in homes of 2,501 to 3,750 square feet of about $6,000 to a total of $19,924 will affect the highest number of his company’s clients.
“That’s really the sweet spot for the market, that 2,500- to 2,600-square-foot range where more of your medium income buyers are,” he said.
Builders have pointed to the fact that Duval County has no impact fees as one of the reasons homes are less expensive there. And in Nassau County, the fees are much lower.