Bob Ivry at Bloomberg has a pretty detailed report on the Florida condo scene, including a good line from Florida Gov. Charlie Crist—that the state bird should now be the building crane. Mark Zandi of Economy.com predicts that Florida will be in recession as early as October, thanks to the rampant overbuilding—particularly in the condo market—that has ground to a halt and is leaving investors, banks and developers sitting on massive losses.
Zandi also notes that construction and housing accounted for 20% of all jobs in Florida—double the national average. Which explains why, with a number of those jobs evaporating, that Florida will slip into recession.
While I don’t expect the national economy to follow Florida—housing didn’t represent as big a component of the economy elsewhere—I do wonder about the impact that the housing downturn will have on the broader economy, given some estimates I’ve seen in past years that housing accounted for much of the economic growth nationwide. What sectors will pick up the slack? What indeed?
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.