EU-DIGEST

European Investors Alert: Is Florida the Sunset State? - by Michael Grunwald

Greetings from Florida, where the winters are great! Otherwise, there's trouble in paradise. Florida is facing its worst real estate meltdown since the Depression. We've got a water crisis, insurance crisis, environmental crisis and budget crisis to go with our housing crisis. We're first in the nation in mortgage fraud, second in foreclosures, last in high school graduation rates. Our consumer confidence just hit an all-time low, and our icons are in trouble--the citrus industry, battered by freezes and diseases; the Florida panther, displaced by highways and driveways; the space shuttle, approaching its final countdown. New research suggests that the Everglades is collapsing, that our barrier beaches could be under water within decades, that a major hurricane could cost us $150 billion.

We do wish you were here, because attracting outsiders has always been our primary economic engine, and our engine is sputtering. Population growth is at a 30-year low. School enrollment is declining. Retirees are drifting to the Southwest and the Carolinas, while would-be Floridians who bought pre-construction condos in more optimistic times are scrambling--and often suing--to break contracts. This is our dotcom bust, except worse, because our local governments are utterly dependent on construction for tax revenues, so they're slashing school and public-transportation budgets that were already among the nation's stingiest. "This may be our tipping point," says former Senator Bob Graham.

Labels: Economy, EU, Florida, Investment Climate

Real Estate Market Crises US: Florida - A buyer's market, but too few buyers - by Bob Tenance

in South Florida, it's a genuine buyer's market. In fact, for buyers here, the market has never been better. They've never had lower prices. They've never had more choices. They've almost never had lower mortgage rates. And they've never had as many options as far as neighborhood, town, size, amenities and style. So, where are all the buyers? For one thing, there's the "R" word hanging over the US - recession. Tied in with this slowing economy is the recipe for a perfect storm - rising inflation, up 2.7 percent for core items (exclusive of food and energy) in the last quarter of 2007. This, in turn, gives rise to the specter of the "S" word - stagflation, which occurs when the gross national product drops, but prices still rise. Unemployment is also rising. And the recession - and the layoffs - of the early 2000s are still fresh in our collective memories. People who are worried about keeping their jobs are probably not rushing into the housing market.

Labels: Florida, Real Estate, US Economy

US - Florida economy in nose dive - Even European Bargain hunters are going elsewhere - by Michael Pollick and Michael Braga

If you are a beach bistro selling margaritas to tourists, you might not notice. But on the mainland, it feels and looks like a recession.The end of the real estate boom has sent ripples through the economy. Cash register receipts are slumping. Many workers — either laid off or marginalized by cut-backs in hours — are leaving town or taking lower-paying jobs. Food banks are dishing out free food as fast as they can find it.Business bankruptcies in the region have doubled from a year ago, while the amount of debt reported in the filings has nearly quadrupled.

Note EU-Digest: Last month the Florida Chamber of Commerce released its New Cornerstone Revisited, a report that outlined Florida's economic future. On tourism Mark Wilson, president-elect of the chamber, said domestic visitors have increased, while international visitors to the state have declined since the 9/11 terrorist attacks. Even European bargain hunters who benefit from the strong euro are going elsewhere in the US.

Labels: Economy, Florida, Tourism, US