Tuesday, November 15

Here's Another Reason I'm Glad We Missed Out on Sutton Lakes House

Back in 2017, we had an offer in on a house in Sutton Lakes (near Atlantic and Kernan). We lost our on the short sale to who turned out to be the father-in-law of the realtor. We were upset at the time because we needed a house, and the location seemed pretty good on paper (we were offering from afar). However, after driving through Sutton Lakes, I was kind of relieved, but now that the Kernan widening is finished near our current house and Sutton Lakes is about to get Amazoned, I'm so appreciative of that realtor's self-dealing that I may send her a note of thanks.

Sutton Lakes is already a pain to navigate because of speed bumps and street-parked cars, and because it's freakin huge. And there's one entrance off Atlantic, along with a weird afterthought ghetto entrance from Alden to the south. Living there would have added 10 minutes to any commute, even if the proximity to Atlantic seemed perfect.

Now, with Amazon wanting to add a delivery station to airport land across the street from Sutton Lakes, good luck everyone. Since Sutton Lakes Boulevard doesn't cross Atlantic in a straight line, we're talking about an extra set of lights so that both sides of the intersection can be cleared. Semi trucks to and from the 295 and delivery trucks in both directions. Yep, I can't think of a better time not to be living in Sutton Lakes, except for when they found a dead body in the one pond and then the alleged killer just kept living in the house next to the pond for six months. That had to be awkward for the neighbors: "Hey, sorry about the mysterious death of your ex-girlfriend in the pond behind our houses. Can I borrow a cup of sugar and the number of the lawyer who's keeping you out of jail?"

Just to add insult to traffic congestion, I noticed that land along Atlantic just to the east of Sutton Lakes is also being cleared. A mini neighborhood, a Family Dollar, another apartment complex? Luckily, I don't have to care. 

25% of Duval County Homes Owned by Investors - Is That Bad?

When I was taking urban planning classes in college, I learned some "truths" about cities, according to my professors. People like bridges. Urban sprawl is bad. Homeowners care more than renters. Widening roads doesn't alleviate traffic. And on and on.
 
Government can control some aspects of these perceived truths more than others. While Jacksonville might not be building any new bridges for people to gaze upon, our government probably does have tools for some of the commonly accepted truths of planning, including home ownership.

Government regulation isn't always necessary when it comes to homeownership, and I'm not entirely sure the negatives of investor-owned homes warrant regulation, particularly if the main negative result is increased prices and gentrification until saturation. That's what happens if investors buy up homes for cash (outbidding families) and then perform quality work on the property. This results in higher sale or rent prices for the area, at least as far as the market can bear.

Of course, one could argue that it's silly for rental investors to buy up properties and then rent those to the unfortunate families who tried to buy the same homes. Worse, those families will probably be looking to save up to build in St Johns County. Assuming you can save anything when rent is $2500 a month (that's what I pay for TWO mortgages). I hope my new rental neighbors will adhere to less than 50% of income put towards housing/utilities and that they therefore make over $75,000 a year. That's a different clientele than for the same houses that rented at $1500 a month when we moved in a few years back.  

The problem is that these home rental investments, even if they charge a lot, need to see profits for investors. It's not like my house in Milwaukee, which I keep nice because I might return someday and because I care about my tenants. So when the investors have to lower the rent $200 a month in order to attract tenants (which just happened next door), that's $2,400 less in anticipated profits per house per year. I am sure the investment companies are seeing that there's a limited pool of qualified applicants who are willing or able to pay over $24,000 per year for rent alone, especially with thousands of apartments in large complexes being built. 

Assuming a bursting housing bubble in the near future, I would be interested to see the investment company strategy, since lower home value should precede a falling rental market. I assume the companies will sell the least profitable properties first, with my assumption being the properties in the worst locations (lower rent and more vacancies). Then again, that's kind of the traditional target market for rentals. Also, if these investment companies see diminished returns, will they really keep the properties looking good? If these investment companies end up like Carvana or Zillow, I wonder what that will mean for Jacksonville's real estate landscape. I guess we'll find out.

Bottom line is that the initial investment into a large percentage of local homes for rental purposes might renew some neighborhoods that probably needed a little work. I saw a lot of paint and new roofs in my neighborhood, and better than neglected homes. I just wish renters cared a little more about their own living conditions.

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