October 8 — Competition for the dollars of the newly retired is heating up, and it seems like Florida could be the state that takes the biggest hit. The Sunshine State, always popular for its retirement communities, has seen a number of negative factors that are increasingly deflecting retirees to other states in the Sunbelt.Retirement in Luxurious Fort Lauderdale
Some of the Florida downsides include overcrowding and traffic, increasing real estate costs (64% higher than just 5 years ago), a spate of devastating hurricanes, and ever-increasing insurance costs related to those hurricanes. The current housing bust is about as bad in Florida as anywhere.
Builders overbuilt, speculators overbought, and prices went too crazy. The near-panic in the market has scared away buyers and discouraged sellers. According to a recent Wall Street Journal article (“Is Florida Over“) that cites Census Bureau data, while foreign immigration to Florida remains strong, “migration from inside the country is slowing.” In fact, Atlas Van Lines moved more families out of Florida last year than it moved in.
Part of Florida’s problem is competition from other Sunbelt states trying to attract baby boomers in retirement. Apparently they have been successful in generating more and more “halfbacks”, retirees from the Northeast who move to Florida, then come half way back to the Carolinas or other Sunbelt states after realizing Florida was not for them. States like Mississippi, Louisiana, Texas, West Virginia, and Kentucky have started Certified Retirement Communities programs to promote retirement for economic development. Other states like Georgia are attempting tax reforms such as exempting retirement income from taxation as a way to attract retirees.
While growth in what has always been one of the fastest growing states in the U.S. might be slowing down, Florida is still growing. One of the comments that we thought made the most sense came from Dave Schreiner, a VP at Pulte Homes’ Dell Webb communities: “Instead of everyone making the assumption that they’re going to move to Florida, now it’s more of a level playing field.”