Vacant properties drag down electricity sales

An increase in vacant homes contributed to a significant slowing Progress Energy Florida's electricity sales, the company said Thursday morning as it discussed first quarter results.

The number of vacant properties increased in February and March, compared with the same months last year, the utility said. The utility defines unoccupied property as a customer using less than 200 kilowatt hours of electricity a month. The average residential customer uses nearly 1,100 kilowatt hours a month.

To read more and to view Progress Energy's presentation, go to our blog The Fueling Station.

-Asjylyn Loder, Times Staff Writer

Second Tampa Channelside condo developer declares bankruptcy

Last summer, dozens of people sued The Place at Channelside to get their money back on condos they felt they overpaid for in 2005.

On Wednesday the developer had had enough. Key Developers Group and its owner Fida Sirdar asked for Chapter 11 protection.

His is the second bankruptcy filing this year among Channelside condo developers. Towers at Channelside LLC declared insolvency in January.

Sirdar completed two eight-story towers last year but many investors who paid top dollar during the housing boom wanted out of the 245-unit complex at Channelside Drive and Washington St.

You've got to sympathize with both parties: The developer who built with confidence knowing he had bona fide buyers and the buyers who realized too late that imploding home values would skin them alive.

The four stages of Home Seller Sickness

The customer is always right, but this is getting ridiculous. I’m talking about Tampa Bay area home sellers who refuse to drop prices on their homes. An exasperated Ann Guiberson, head of the Pinellas Realtor Organization, says asking prices are up over last year by a few thousand dollars.

How can that be? We’re stuck in a Florida-wide housing retraction with talk of 25 percent price declines in the air. Call it Home Seller Sickness. I had the affliction earlier this year when I sold my house after wrestling with the dead-weight market for more than half a year. The disease has four stages, ranging from prickly denial to glum acceptance:

Stage 1/My House Is Better Than Your House: You list your house for $300,000. Your neighbor lists the same model for $275,000. Of course, you can justify the premium you’re charging. Your kitchen has new floor tile, handmade by Venetian artisans. Your neighbor has brown linoleum, circa 1979. You start pricing the Toyota Highlander you’ll buy with the profits. House hunters respond by treating your home as if it’s the Bates Motel.

Stage 2/Maybe I Was a Little Rash: You’re forced to drop the asking price to $275,000. Sure, you’re still not undercutting your neighbor, but that guy’s a slob. Did you see the orange paint in his living room? Hasn’t redecorated since Fonzi was on TV. Plus, you’ve installed the best aromatherapy system on the block. One whiff of “ocean breeze” and “fresh laundry” and buyers will be racing for the contracts.

Stage 3/You’re Going to Make Me Work for This, Aren’t You?: Six months pass. Neither you nor your neighbor has sold. You drop the price to $249,999. Your realtor insists on the $999 trick: Make the house look desirable. Cancel the Toyota SUV purchase. Settle for an electric scooter.

Stage 4/Will Somebody Please Kill Me Now?: You drop your home price to $234,900. It’s the cheapest house on the block. The buyers finally make an appearance but demand you knock off another $15,000. You accept an offer just to be done with it. They nitpick you to death, insist you fix every jiggly doorknob or else void the contract. The buyer’s smile at closing contrasts with your frown. You blame your realtor. It’s all her fault. But the scooter ride home is invigorating.

--James Thorner

In real estate, unwholesome recipes for holidays

With the holiday season’s arrival this Thursday, let’s welcome a festive break from the housing doldrums. But before we do, let’s assemble a list of the rogues and dupes who have made the real estate market such an unwholesome place for the holidays.

You’re behind on your house payment. A postcard arrives in the mail. A company promises to fix your foreclosure for $1,200. One condition: Don’t call your lender. The foreclosure fixers will handle everything. Who could refuse such an offer? The company must have spent at least a quarter on postage. Many people forked over $1,200. How did it work out? Let’s say quite a few homeowners are now not-so-happy renters. The TV show Inside Edition savaged one of those self-proclaimed rescuers, Clearwater’s Foreclosure Assistance Solutions. Nothing says subtlety like the juxtaposition of homeless customers with the owner’s $2-million waterfront mansion.

A special niche in the rogue’s gallery goes to the people who manipulated the market at The Club at Brickell, a 43-story condo tower in Miami. They committed deception on such a scale that bankers are calling it a national epicenter of mortgage fraud. Phony appraisals and lax underwriting let crooks arrange sales of $400,000 condos for $800,000. The cheaters paid the sellers $400,000 per condo, cashed out the remaining $400,000 and let the empty condo fall in foreclosure. Investigators said about 200 of the deals were shady.

Wonder why Florida leads the nation in mortgage fraud? Stick the next case in the dumb-as-a-sheet-rock file. Transeastern Homes, operating in Tampa as Engle Homes, is one of the builders lanced by bankruptcy rumors this month. Here’s one reason: Transeastern was notorious for its high-pressure, cattle-call sales events. At one event at Saddlebrook Resort in Wesley Chapel, if you didn’t sign up for a home quickly, you’d be exiled to the rear of the line. The ploy came back to bite the company. So eager was Transeastern for fast sales, it lost money on many transactions. Construction costs rose and the company couldn’t renegotiate home sale prices they locked in.

We could fill the list with more examples, but that’s plenty for now. Must leave room for pie.

Call it the Great Home Heist of 2007

The proposal to double the homestead exemption from $25,000 to $50,000 on Florida homes is a joke. There, I said it.

But it’s hard to laugh at this particular joke. In all the debates about property taxes, no one seems to mention that the $25,000 homestead exemption, effective since 1982, has been The Incredible Shrinking Tax Break for 25 years. When the exemption was increased from $10,000 to $25,000 between 1979 and 1982, the median home price in the Tampa Bay area was about $50,000. In other words, the exemption cut the taxable value of your house in half. March forward 13 years.

In January 1995, when the complementary Save Our Home tax cap took effect, Tampa Bay area homes sold for a median price of $71,000. The homestead exemption exempted about 35 percent of a home’s value. Observe our plight today: Based on September’s local home sales price of $200,700, the value of the exemption is only 12 percent of a typical home’s value. What seemed like a governmental gift in 1980 is the Great Home Heist in 2007. Home values have risen through the roof, but the state hasn’t indexed the exemption for inflation.

Instead, the Legislature passed Save Our Homes, approved by voters in 1992. SOH caps the increase in taxable value of a primary residence at 3 percent a year. When you move, you lose the accrued savings and are taxed at your new home’s real value. Florida Tax Watch flagged the unfairness of SOH back 1992. People mistakenly think SOH is a tax cut. It’s not. It’s a tax shift, a shift to first-time home buyers, businesses, vacation homes and anyone who wants to change his or her address. To its credit, the Legislature tried to rig a fairer tax structure this year. The homestead exemption would have expanded to 75 percent of a home’s value up to $200,000. The state would have taxed a $200,000 house as if it had been worth $50,000. Voters feared the change. A judge objected. And the Legislature hatched this turkey of a compromise to double homestead to $50,000.

On my house, it’s going to cut $200 off a tax bill of $6,200. The sound you hear is laughing. And it’s not the joyous variety.

Are jobs cuts in real estate finally slowing?

Here's a good-news-bad-news report about jobs in industries like mortgage lending, real estate, and construction.

About 6,500 people across the nation lost jobs with mortgage lenders in October. That's bad enough, but not when you compare it to the more than 50,000 mortgage workers who lost jobs in August and September.

It was a similar story in housing, which includes real estate agents and construction workers. About 12,000 people lost jobs in October, far below the nearly 57,000 who dropped from those industries the two months before that.

The figures come from the Chicago outplacement consulting firm Challenger, Gray & Christmas Inc.

"It may be too soon to declare an end to the crisis in housing and the credit markets, but this is definitely a very positive report," said John A. Challenger, chief executive of the company.

Many of those jobs cuts are happening in Florida, which shares top honors with housing-stressed states like California and Nevada.