Florida Economic Recovery

If you are a resident of South Florida, chances are you’ve noticed the weather start to change recently. Every year around this time the cool temperatures that we’ve come to enjoy over the winter months start to become increasingly rare. Temperature and humidity increases are an all to familiar reminder that the rainy season is approaching. This year it seems as it is coming a bit early as we’ve seen quite a few wet days already. All of us Floridians know that rain is simply something we have to deal with. We all know that during the summer months, rain will come. The only real question is, how much?

Luckily we have been able to escape any big storms for quite some time, 2005 to be exact. That year Florida was hit in late October and caused over 20 billion in Miami water damage. It has been over 7 years since that natural disaster. Last year we had 2 close calls with Issac and Sandy just missing landfall. All of this crazy weather happening has everybody wondering, is Florida due to get hit by a big storm this year. Nobody knows for sure but if the Chicago water damage that is happening right now in the early month of April is any sign, we might be in for a long hurricane season.

Other than living in another state, there is nothing you can do to avoid the possibility of these issues. For the people that make their living in the sunshine state, moving is an unreasonable option to avoid a little rain. What we can do is prepare for the possibility that a big storm does hit landfall. Here is a list of recommendations from FLA Recovery to make sure you know what to do in the event of a hurricane or strong tropical storm.

• If you are instructed to evacuate, please EVACUATE
• Board up as many windows/doors as possible
• Be prepared for extended power outages
• Buy a generator if possible
• Have a full tank of gas in your car and reserves
• Stock up on water and food that will not spoil
• Stay as far inland as possible
• Avoid going outside at all costs
• Get you home inspected prior to hurricane season

Hopefully we’ve opened your eyes to some steps that you can take to preparing yourself for this coming hurricane season. We sincerely hope that we are lucky enough to avoid any major storms altogether for at least one more year!

In an ironic twist of fate, it looks as if the one thing that put our economy into a tailspin may be slowly bringing us out. When the housing bubble burst, just about everyone was negatively impacted in one way or another. Real estate agents, home builders, contractors, and investors have all lost a substantial amount of money. With our economy in a recession and good paying jobs getting harder to come by, it is understandable that people have been less willing to invest in a new home. Another reason for the dip in home purchases is the difficulty in getting a loan. This is a reasonable consequence of the bubble bursting, since giving loans to people who could not afford them was part of the problem in the first place.

After some years of futility it appears that the housing market is back on the rise and South Florida is seeing improvement as well. According to the Sun-Sentinel, Broward County’s local newspaper, the average sale of a home has risen 9% over the past year. It’s neighbor to the north, Palm Beach county has seen even better increases of 20%. Broward county has also seen an increase in the number of homes sold. When comparing 2012 to 2011, there has been a 24% increase in purchases.

These stats are very encouraging and indicate that we are on the right track to economic recovery. An increase in real estate sales benefits numerous industries both directly and indirectly in the field. Typically when people purchase a home they use services like home inspectors to see if their are any problems. A representative of MI&T, a local mold inspection company reports, “Business has most certainly increased.” After purchasing a home, people usually make improvements and changes to customize their new purchase. That means buying materials and hiring contractors. All of these things stimulate the economy and increase jobs.

With the prices of real estate on the rise, many people are thinking now is a great time to purchase a home. Having people in this mindset is a great thing for our economy rather than being scared of entering the market due to fear. Whether or not these trends continue and prices continue to increase and promote economic growth remains to be seen. One thing is for sure, things look much more promising today than they did a couple of years ago.

In spite of Florida’s Stimulus money for recovery, Palm Beach County, Florida, found itself with 2400 fewer government workers last year, as reported by Florida’s Economic Opportunity Department; who recently released these employment figures. Job cuts and property tax collection shrinkage, as well as the decline of home values, has affected the economy in a drastic way, dragging down the recovery and causing shrinkage in capital projects. Federal stimulus money was infused into the economy statewide to the sum of about two and a half billion, yet the decline was not slowed much, and these funds have dried up.

Economists theorize that with local government being forced to scale back in lieu of the end of the stimulus, inadvertent damage is done, and the government cannot take complete blame. Other groups, like Wells Fargo, say that the cutbacks forced governments to adapt more frugal spending habits after years of being frivolous and spending rampantly like plantar fasciitis without much regard. Unfortunately, job and economic growth was affected and this out of control spending now tempered with the current cutbacks will likely do more harm than good; most certainly it will not serve to help the economy much at all.

Regardless of the boost in growth that lasted for 2 years the fourth quarter GDP measure from 2011 measured in at 2.8%, which was lower than expected. Consumers spent money during the holiday season in December as the inventories were boosted by merchants, but the monies were not spent as freely as previous years and resorted to tapping into their savings accounts and utilizing the 2 percent personal consumption gain.

In 2005, Governments overall consumption was found to topple down to at least 7.3 % since the third quarter, but consumption has been decreased over the course of subsequently 6 quarters and the better part of the past three years. This spending could likely influence a quarter of the difference responsible for the entire nation’s growth rate during the next two years or so. Growth rates have been predicted to be as low as below 3% this year alone.

While Florida’s stimulus recovery money seemed to patch the gap in the economy at the time, in its absence, Government is now forced to make daunting decisions in regards to budget cuts and balancing a reasonable State budget. It must take up the reigns and temper itself with more prudent and responsible spending habits. Such an endeavor takes time, and everyone must be on board, members of government and the constituents. In this way, everyone shares the responsibility of getting back on track to restoring a viable and thriving economy.