Vacant Homes

The Wall Street Journal published census data on vacant housing last Friday. Census numbers point to areas in and around Orlando, Fla. as having the largest number of empty houses. Orlando’s home vacancy rate was 7.4% in 2007. Other Florida markets also showed high-and-rising home vacancy rates: Tampa-St. Petersburg (5.1%), Jacksonville, Fla. (4.6%), and Miami-Ft. Lauderdale-Miami Beach (4.4%).

Bear in mind that the national rate rose to 2.8% in the fourth quarter, matching a record set in the first quarter of 2007. It’s the highest this rate has been since the government began tracking vacant homes in the 1960s.
 
The Phoenix/Mesa/Scottsdale vacancy rate is shown at 3.7% with Tucson at 2.2%. Flagstaff homes don’t make the chart, but my sense is that we’re lower here, just as the rate of foreclosures in Flagstaff has been lower.

According to the Journal report, economists say that homeowner vacancy rates are one decent indicator of overall housing supply, with a mounting vacancy rate likely to exert downward pressure on prices. But economists also caution that it’s crucial to consider vacancy and other indicators of oversupply in connection with a region’s economic fundamentals, such as employment and population growth, when trying to forecast where housing prices will go. In other words, worry more about vacant homes in Michigan and Ohio than in Arizona, where unemployment remains around 4%.