Morris Massre is a Realtor with Fortune International Real Estate.

What constitutes a real estate/economic recovery? If it is simply rising numbers in housing starts and sales, for instance, then are we really in recovery mode like some experts may expect us to believe, or are the numbers clouded by some underlying problem that the rest of us are not seeing?

Perhaps nowhere more than Florida is housing and the economy more closely tied together.  You may read about a new project that has started construction or about a percentage increase in sales one particular month, but the grim reality is Florida is not even close to recovery, especially South Florida.

The single most important fact that prevails in all of this conversation and speculation is the fact that 16 percent of Florida’s residents live below the Mendoza line, and that is the scariest number of all.

It’s the first time since 1995 that the poverty line has moved past 16 percent.  Not only that, the poverty rate has steadily increased for the past five consecutive years, and to make matters worse, the median household income is only $44,243, as opposed to $49,445 nationally. What’s more, 3.85 million Florida residents do not even have health insurance. That’s more than 20 percent of the state’s entire population.

So what does this mean, to recover?  Tourists who flock to the beaches and Disney World rarely see the underbelly of Florida, until they get suckered into buying an income producing property by one of their friends in the business who is only out for himself.  This is what happened during the boom.  The housing shortage of the boom years was indeed a myth perpetrated in part by foreign investors lured into buying by their friends.

Now there is a glut and everyone wants out.  But where are the buyers?  Foreign investors now have finally wised up about South Florida property and are doing their homework.  They simply want deals, which means that traditional sales with them is out the window.  It is the local buyers that really drive the market, and they either have no money as indicated already, or are too scared to buy.

In other words, in order to fix the housing crisis, we have to fix the economic crisis with our very own citizens who are either broke or on their way.  These people are the backbone of the housing market, because without traditional sales, all we have left is investors and renters.  We can only subsist on this diet for a short period of time before the locals get antsy and move away to brighter pastures.  This is the one time in my long real estate history that I have actually witnessed residents leaving South Florida to go back to South America for a job!

Let’s face it, you can lower the interest rates all you want, but if someone does not have the means to buy, what is the point?  Not every neighborhood in South Florida is Coral Gables or Weston.  Take a drive to Opa Locka or Lauderhill to see the other side of real estate decline.

Downtown Miami is making a comeback, but unless everything comes together with the gambling issue, it may all be for not. Miami’s Realtors should be focusing more on traditional local buyers, rather than investors, because in the long run, those are the people that are going to push us over the top.

The primary buyers are the people who drive the economy, who sit on their investment and wait for a decent return, and in the long run, will buy and stay put so long as we get them back to work and keep them from renting. We have to gain these people’s confidence and find a way to get them into affordable housing so that everyone can enjoy the American Dream of home ownership.

And I am not saying to abandon investment buying.  One has to make a living.  But you better be ready for the next phase of South Florida real estate because this is the one time when the numbers simply do not lie.  My job as a Realtor is to build relationships, which eventually lead to referrals.  Investors may be driving the real estate market, but it is traditional buyers who sustain it.

For more information on these new developments you can also visit my website at www.myfloridarealty.net

Morris Massre is a Realtor in South Florida with Fortune International Real Estate. He can be reached at:

agentsunstate@gmail.com

www.myfloridarealty.net

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