Tear-down, rebuild home boom in Holmes Beach
These two homes under construction on 66th Street in Holmes Beach are just two of the nearly 40 new homes and duplexes in the city that have been built on a property in the past year after the prior structure was torn down or removed. The sale price of each of these units should be well over $1 million, a local real estate agent said. Islander Photo: Rick Catlin
A demolition permit was issued Jan. 19 for this single-family canalfront residence at 527 74th St. in Holmes Beach. Islander Photo: Rick Catlin
Holmes Beach homeowners looking to cash in on the Island's real estate boom are tearing down older structures and replacing them with new homes with a hefty price tag.
During the last three months of 2005, the Holmes Beach Building Department issued eight permits for residential demolition - four single-family homes and four duplexes.
And during the same three-month period, the department also issued building permits for seven new dwellings with an estimated construction cost of $4.05 million. Of those permits, five were for new duplexes.
While that seems like a rush of tear-downs and rebuilds in Holmes Beach, the fourth quarter of 2005 was actually slow compared to the first three quarters of the year, Holmes Beach Building Official Bill Saunders said.
"We'd been averaging about one (home/duplex construction) permit a week, almost a dozen a quarter since January 2005," he said. "It seems like everyday, we'd see another home being moved off the Island to make room for construction. The last three months have actually seen a bit of a slowdown."
According to figures at the building department, 22 permits to tear down a single-family home or duplex were issued in 2005, while 38 permits for construction of either a new single-family home or duplex were authorized that year. The total construction value of all the projects was more than $20 million.
Saunders noted that prior to January 2005, the department would normally issue about four or five new residence construction permits during a three-month period. He also pointed out that the cost of the project on file with the building department is the construction estimate, not the sale price.
And tear-down permits are not just for older homes. Last week, owners of the property at 667 Key Royale Drive indicated to Saunders they would apply for a demolition permit to allow Ruttenberg Homes Inc. to build a new, multi-million dollar residence.
Indeed, any home selling under $1 million on the Island these days is almost considered "down market."
The latest real estate figures report that the average single-family home on Anna Maria Island is selling for more than $900,000, while the average condominium sale price is at $1.06 million.
"It's just indicative of the changing Island," said Mayor Carol Whitmore. "It's supply and demand. People want to live on the Island and price is no object."
Island real estate values have nearly quadrupled the past five years and homeowners are taking advantage of the real estate boom to rebuild, said one local real estate agent.
"It's simple economics," he said. The demand for Island living is still strong and many Islanders have their retirement in their property, he added.
The real estate agent explained that if someone has an older home with just a small mortgage or none at all, it might make financial sense to tear it down or move it, then build a million-dollar structure and sell that new home for big bucks.
"A lot of people are pocketing hundreds of thousands of dollars on these deals, moving out east or somewhere else and paying cash for a home and they still have money left over," the agent said.
The construction boom has been a bonus for the Holmes Beach treasury as the city took in $77,783 in permit fees for that three-month period along with another $1,100 in demolition permit fees.