Dear Toby - March 2008

Your Comments and Questions - My Replies

I receive several comments and questions from website visitors. To many, I have responded individually. It occurred to me that some of these questions and answers would be of interest to all of you. I publish selected input and replies under the “Dear Toby” banner, with a new page each month to keep the pages short and readable. The most recent entry is at the top of the page.

Feel free to use the “Contact Us” button to send in your comments or questions. Your name will not be disclosed. Due to volume, I may be unable to reply to everyone.

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Question: I read in the paper that the City of Palm Coast topped the nation in population growth in 2007. 7.2% increase. Do you think this will help bring Corporations to PC and lead to higher paying jobs in the City? Do you think this will help restore property values in the future?

Toby Says: The population growth news is good for many reasons. It indicates that many people still feel that Palm Coast is a good value, which it is. The median selling price for single-family homes in Flagler County is not only below the Florida median, it's below the national median. It remains the least expensive warm water area on the east coast. This continuing influx will help absorb the overproduction of homes from the boom days and eventually lead to rising prices.

I'm not as hopeful on the jobs and wage level question. The increased population will attract retail and service businesses with traditionally low paying jobs. What the area needs desperately is industrial or high tech businesses which will bring in capital and higher paying jobs. Industrial properties typically pay two to three times more in local taxes than they demand in government services. But growth alone will not bring them. They need both affordable property and existing infrastructure to support them. Flagler County has a shortage of both. I urge you to contact your elected officials at both the City and County level to urge them to do more to attract industry.

Question: Noticed the city put up a sign for the newest fire station on the "Kohls" property. Does this mean the project has jumped its permitting hurdles? And, what impact is the current financial crisis going to have on all this commercial space going up everywhere?

Toby Says: Kohl's was tied up in a wetlands permitting problem because the army corps of engineers claimed jurisdiction over wetlands on the site. That hurdle has been passed. The developer of the Kohl's project agreed to build a new fire station on Corporate Drive which will replace the current station on the property. The official groundbreaking for the new station was March 18. Construction could commence as early as April. Once the station is complete, the old station can be taken down and construction can commence on the Kohl's complex. Kohl's anticipates a spring opening.

The answer to your second question is more difficult. Commercial real estate experiences cycles similar to the residential sector. In Palm Coast, this cycle is a few years behind residential. The large stores will probably do well as Palm Coast needs them. Meanwhile Palm Coast continues to grow, but it will take time to absorb the increased inventory of commercial space. Projects like Roma Court and Village Walk will find the economic climate problematic. CVS has already delayed construction of their new store planned for the John Anderson, SR100 corner.

Question: Can you explain how the price I sell my home for and the price I pay for my next home affect portability of Save Our Homes savings.

Toby Says: Save Our Homes caps any yearly increase in the taxable assessment or your homesteaded property at 3%. The taxable assessment, minus any exemptions, is the basis for your property tax under Save Our Homes. Another important number is the "just (market) value. This number is determined by the property appraiser's office based on values of similar properties in your area and is likely to change yearly

When you first purchase your home, the just value and assessed value are the same, although not necessarily equal to the purchase price. Once homesteaded, the just value climbs with the market, but the assessed value increase is limited. Over time, the difference can be quite large, especially during a period of rapid price increases such as from 2002 – 2005. This difference is the savings under Save Our Homes.

In the past, you lost your savings when you moved to another home in Florida. Under the recently passed constitutional amendment, a portion or all of your existing savings can be ported to your next home. The savings amount is not affected by the selling price or purchase price. The only numbers that matter are the "just value" and "assessed value" of the home you sell and the one to which you move. If the just value of your new home is equal to or higher than the just value of your old home, the total amount of your savings can be ported. If the just value of the new home is less, the amount of the ported savings is determined by the ratio between the just values of the two houses. If the just value of the old home is $200,000 and the just value of the new home is $150,000 (75% of $200K), then 75% of your prior saving is portable.

Question: I heard that the Palm Coast Resort property had been sold to Marriott and that they were going to close on March 15. Any truth to this?

Toby Says: According to a good source within Centex, there are some active lookers, but no contract is signed. Looks like it's just a rumor.

Question: I see where a building permit was issued in January to Houilighans Restaurant. Have they started to build?????

Toby Says: I drove by today (3/8) to check. There were workmen busy at the site. They are in the building on the right as you enter the Home Depot Plaza, opposite Outback.

Question: What development is going on behind the microhotel & near the cracker barrel restaurant?

Toby Says: The building under construction will be a Fairfield Inn. A building permit was issued by the City of Palm Coast valued at $8,000,000. The developer paid $284,578 in impact fees exclusive of water and sewer.