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PALM COAST, FL – April 20, 2018 – ITT’s master plan for Palm Coast has run its course. Population growth, changing demographics, and technology are rendering our growth management template obsolete as Palm Coast and Flagler County continue to plan growth around the ITT/Levitt model.
In the early 1970s, ITT planned and began developing Palm Coast as the largest master-planned community in the country at the time. ITT’s planning partner was Levitt & Sons, the company that invented urban sprawl following WWII with seven Long Island housing developments collectively known as Levittown.
LEVITTOWN, LONG ISLAND
Palm Coast was planned to be different, not block after block of sameness. Palm Coast has miles of saltwater and fresh water canals. Residences are located off and away from busy thoroughfares. Golf courses were interspersed among the homes. Homes were required to be painted with warm earth tones. Over 40,000 lots were platted; nearly all with 10,000 square feet of land. Extensive landscaping and setbacks were required. Commercial signage was heavily restricted.
PALM COAST (C SECTION)
The result; Palm Coast is beautiful. Visitors are universally struck by the city’s uncluttered beauty, with its arching Spanish moss-covered live oaks. Its newness precludes urban decay. As of August 2017, the median age of an existing home in Flagler County was only 17 years. In Palm Coast, the median was a mere 15 years.
Palm Coast has been recognized as one of “America’s 50 best cities to live.” Palm Coast is relatively affordable too. From a recent study of retirement options highlighted in the Palm Beach Sun-Sentinel; “Of the 11 urban areas compared in Florida, a $1M retirement account lasts longest (32.5 years) in Palm Coast…” (BTW, New York City was at the bottom of the national list at only 12.5 years.) Yet the report describes Palm Coast not as a beautiful place to live but as a “sprawling suburb.” While there are no homes directly on thoroughfares in Palm Coast, sprawl is still evident. Rather than neighborhood commercial centers within walking distance, Palm Coast has scattered gas station/convenience stores.
PALM COAST (P AND R SECTIONS)
I, for one, love Palm Coast. I often talk about the quality of life here, but when someone asks why I love it so much, I don't say, “it’s because of the suburban sprawl. Palm Coast has much to brag about, but 40 years of growth and changing demographics have uncovered warts in the ITT/Levitt plan.
Palm Coast’s stormwater management system of swales, ditches, and canals not only cost less to build than a traditional curb and gutter system, but it is also very efficient. Over the years, city property owners have suffered only minor flooding damage, even during two recent hurricanes. Unfortunately, swales preclude sidewalks in most of Palm Coast’s residential areas.
Palm Coast and Flagler County have well over 100 miles of well-built paths and walkways for biking, jogging, and walking. Yet, almost all errands require a car. Trulia says that 100% of Palm Coast residents commute by car. Via Public Transportation, 0%. Walking, 0%. By bike, 0%.
Palm Coast’s street layout puts homes in cul-de-sac-like neighborhoods isolated from main thoroughfares. This design keeps heavy traffic out of residential areas but makes traditional public transportation impractical. People are not likely to walk as far as two miles from deep within the “P” Section to a bus stop on Belle Terre.
WalkScore.com says, “The 202 largest cities in Florida (the most populous cities in FL are Jacksonville, Miami, and Tampa) have an average Walk Score of 32. The best cities in Florida ranked by Walk Score are Miami (walk score 79), Miami Beach (76), and Hialeah (69), while the least walkable cities are Poinciana (4), The Acreage (5), and Palm Coast (7).” Zip code 32164 has a walk score of only 4. Only one resident in ten living within the 32164 zip code can walk to a restaurant, bar or coffee shop in five minutes.
Several factors have contributed to Palm Coast’s suburban sprawl. First is zoning. Palm Coast requires a single-family residential (SFR) home to have at least 1,200 square feet of living area with a two-car garage. Essentially, that’s a three bedroom, two-bath house. Allowable SFR densities are 7 seven units per acre for 50 ft. lots, five units per acre for 60 ft. lots, and four units per acre for 80 ft. lots.
Duplexes can have as little as 800 square feet of living area, but the number of available city lots designated for duplexes is limited. Only 135 duplex building permits were issued by Palm Coast between 2005 and 2017. There are currently 816 duplexes in the city.
Medium density multi-family buildings (condos and apartments) are limited to eight living units per acre while high density allows 12 per acre. Allowable multi-family density in nearby Ormond Beach is more than double Palm Coast’s.
There have been no multi-family permits issued in the county or the city in over three years. The city currently has only 1,694 condominium units, 1,147 apartment units, and four mobile homes compared to 32,421 SFRs.
Residential density is important because it attracts nearby commercial development and jobs, resulting in a much higher Walk Score. Higher density multi-family developments support higher quality construction, a broader array of amenities, and on-site management. Low-density developments exhaust developer’s budgets, promoting residential-only sprawl. Without nearby shopping, restaurants, and jobs, residents must rely on their automobile.
Impact and utility connection fees play a role in promoting suburban sprawl too. A Palm Coast SFR permit requires fee payments of roughly $17,000 per home, regardless of size. This “tax” is highly regressive. A buyer of a 1,200 SF home ends up with a $14.17 per square foot surcharge, while the per square foot fee burden is only $6.80 for a 2,500 square foot house. It comprises more than 11% of the cost of a $150,000 house but only 3.4% of a $500,000 house.
It costs more than $500 per lot frontage foot to provide infrastructure in a new development, exclusive of entry features, additional lift stations, amenities, land acquisition costs, land use changes, permitting, and a spine road. It's just cost prohibitive to have 80' and 100' lots.
It’s natural that people are most comfortable living around people who are like themselves, culturally and economically, even age. Yet these same people want readily available services such as healthcare, schools, police and fire protection, restaurants, homebuilders, branded retail stores and locally owned businesses. Our workforce needs to live in the community, convenient to their workplace. A healthy housing stock profile makes room for people in all stages of life and on all rungs of the economic ladder as well as people, young or old, who simply desire less space and lower maintenance needs.
The autonomous automobile and ride-sharing services, such as Uber, will quickly transform transportation. The smartphone has become ubiquitous in only ten years. tt has revolutionized our lives. Few people use a traditional camera. I don't wear a watch anymore. We pay at Starbucks, surf the Internet and get our news with our smartphones. Texting is replacing email. Our language and vocabulary have been changed. I have a granddaughter in Washington DC in her mid-20s. She has neither a car nor a license to drive one. She has a smartphone with the Uber app. She certainly does not need a two-car garage. Most children born today will never own or drive a car. Residential and commercial planners with vision are already talking about repurposing vast parking lots and about designing specifically for expanded dropoff and pickup locations.
Palm Coast’s homogenous housing stock is woefully inadequate. The city’s population growth is outstripping the capacity of labor-constrained home builders. With demand exceeding supply, home prices and rents are rising; faster than income growth, resulting in an affordability crisis. The year to date, the median selling price for a single-family home in the city is $206,000 ($218,800 for all of Flagler County). Trulia pegs the median monthly rent at $1,385.
Of nearly 600 single-family Palm Coast homes listed in the local MLS, 59% have three bedrooms. Another 35% have four bedrooms, leaving only 6% for "all other." There are no one-bedroom homes listed and only 15 two-bedroom homes listed.
Of 1,920 single-family Palm Coast homes sold via MLS in 2017, fully 65.4% were three-bedroom. There were no one-bedroom homes sold during the entire year. While two-bedroom homes comprise only 2.56% of listings, they accounted for 4.84% of 2017 home sales. Two-bedroom homes sold more quickly too. The Median Days on Market (DOM) for two-bedroom homes was only 21 days. For three-bedroom and four-bedroom homes, DOM was 37 and 57 days respectively.
Only one one-bedroom home has been sold in Palm Coast (via MLS) in the past ten years. This home was built in 1973.
What does this tell us? There is a pent-up demand for smaller homes. I would argue that there is also a substantial demand for homes too small to be built under the current Land Development Code.
Flagler County has an active program to attract target industries. Among them are:
At the same time, Flagler Schools are gaining an international reputation for their Flagship program (Classrooms to Careers) which prepares students for an array of career paths beginning in elementary school. These programs include:
These laudatory programs are creating our future workforce and augmenting the county’s economic development efforts. Our young people will graduate prepared to enter a local workforce of target industries. Success will enhance our area’s economic stability and shift some of the property tax burden from residential to commercial and industrial.
However, employers and a qualified local workforce are only two legs of a three-legged stool. The employees need to have a place to live and play. Look at the list of target industries. Does their workforce consist of affluent retirees from the northeast? No. They are millennials. They are members of the X or Y generation; some with heavy student debt. They will have become comfortable using ride-sharing services. Not all of them will gravitate towards three and four-bedroom homes with two-car garages. Many will be renters.
Lifestyle and economics will guide and limit their living options. Zoning must make room for them. Without workforce housing, economic development efforts will fall short. Our remarkable schools will not create local workers. Rather, they will become our most successful export industry, training our children to go somewhere else to pursue their dream careers. And the local property tax burden will fall entirely on the residential sector.
At a recent meeting, Palm Coast's Planning and Land Development Regulation Board (PLDRB) acted on a proposed ordinance to amend the Transportation, Connectivity, Access and Parking section of the Unified Land Development Code. They recommended that City Council approve the ordinance but with a key modification; one-car garages to be permitted (not required) within all residential categories (including SFR). In other words, the new minimum will likely be a one-car garage.
Also recent, City Council heard a presentation by staff of a proposed new initiative for Town Center. The idea is to delineate an overlay Innovation District within Town Center that will encourage more diverse housing products. Among the ideas are smaller residential lots (50’ or less) and higher density multi-family housing.
A walkable urban core could be on the horizon. Town Center’s existing network of winding walkways has existed for years. Now we can have places to walk to and from.
These bold steps pave the way for needed housing options for our future residents while supporting our economic development efforts which, in turn, will shift some of the property tax burden off residential property. Here's hoping that the City Council follows through on these important initiatives.
Toby Tobin: REALTOR®, SRES®
I am a Florida licensed REALTOR® and Seniors Real Estate Specialist, SRES®, affiliated with Grand Living Realty in Palm Coast, Fla. I have years of experience and a treasure trove of relevant analytics. By consulting with me, developers, builders, homebuyers, and sellers achieve improved outcomes and reduced stress, knowing that their real estate decisions are fact-based.
Call me at (386) 931-7124 or email me at Toby@GoToby.com.
Be sure to listen to my radio show, Real Estate Matters, every Saturday morning right after the 11:00 A.M. news break on WNZF News Radio (1550 AM or 94.9 FM). Download the Flagler Radio App from the App Store so you can hear Real Estate Matters from anywhere in the world.