By PAT BEALL Palm Beach Post Friday, July 27, 2007 Healthy buyer demand and a shrinking housing supply still have not breathed new life into the ailing South Florida housing market, according to a second-quarter report from Metrostudy. "Even though the fundamental market remains sound, the home building and mortgage lending industries have created a series of problems that are delaying a rebound in home sales," said Mike Inselmann, president of the real estate research firm. The most obvious problem is a credit squeeze. Lenders once eager to extend credit are seeing mortgage defaults pile up and are tightening loan standards in response. While there are plenty of would-be buyers, the number who can qualify for a home loan is shrinking, the report's authors found.

That has kept people from moving into vacant homes - and there are lots and lots of vacant homes. In St. Lucie County alone, according to Metrostudy, 1,368 finished homes stand empty. At the annual rate of buyer move-ins, it would take 9.5 months before St. Lucie would fill its roof-and-mortar inventory. Yet during the second quarter, builders started work on another 205 homes. Not everyone is optimistic. Centex recently opted out of a planned 800-acre, 1,650-home development in Martin County. Metrostudy found just 39 new home starts in active subdivisions in Martin County this past quarter. It's the lowest in a decade. Developers in Palm Beach County also are building less. The second quarter's 423 new housing starts represent a 71.8 percent decrease from the second quarter of 2006. The pool of available buyers also is drying up: 1,143 buyers moved in during the second quarter of this year, down 29.6 percent compared with the second quarter of 2006. There are bright spots. Metrostudy ranked Valencia Pointe, a new 55-plus community in Boynton Beach, among its top 10 South Florida communities, based on the development's reported 227 new housing starts and 275 new move-ins.