TBO.com - Tampa Bay Online
Tampa Bay Land Bust Is Nothing New
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Published: March 24, 2008
According to a popular real estate valuation Web site, the average home in Hillsborough County has dropped 10.2 percent in value over the last year.
You may be wondering: Will my home price increase again? If history is a guide, the real estate excitement we've experienced in recent past will return.
Looking over the past 90 years, this area has seen three land booms. Tampa Bay experienced a land boom in the 1920s as cars became more affordable, and Henry B. Plant expanded his railroad allowing the area to be more accessible. Temple Terrace began to grow, as well as the newly built Davis Islands. On a single day of sales in 1924, David P. Davis sold more than $1 million worth of lots. St. Petersburg experienced a similar situation after the completion of the Gandy Bridge the same year. Like all good times, the real estate market collapsed as the economic times toughened just before the Great Depression swept across the country.
The land boom returned at the end of World War II, when the returning soldiers began to start their families and the Interstate Highway Bill of 1956, was passed. This legislation provided federal money to build the interstate system, including I-75 and I-4. The buyers continued purchasing real estate into the 1960s, as many developers bought up Florida agriculture land for housing and other developments.
The most famous was Walt Disney's purchase of 27,400 acres in Central Florida beginning in 1964 to create his amusement park vision. The tough economic times of the 1970s recession slowed down the real estate market again.
The next wave of Tampa Bay land excitement came in the 1990s as the economy improved, assisted by a rising stock market, especially the technology stocks. This trend continued as the technology stock bubble burst and people moved their money from the stock market into real estate. Many took advantage of the plentiful mortgage loans and the belief that the home prices would continue to rise.
Hillsborough County's growth pushed into the northern part of the county and caused infill developments in South Tampa.
Meanwhile, Pinellas County enjoyed the beachfront condo boom, along with the revitalization in downtown St. Petersburg. We are now witness to the end of this cycle.
Take note of history, sit back and wait for the real estate buyers to return.
Gary Gresham is an MBA living in Tampa.
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