July 19th, 2011

By MICHAEL BRAGA - Sarasota Herald - Tribune

LAKEWOOD RANCH - Builder John Cannon Homes sold 37 homes during the first six months of 2011, three more than the company sold in all of 2010.

Lower construction prices also boost new homes' appeal.

Much of that activity has taken place in Lakewood Ranch, where Cannon is based, and which developers of the master-planned community are characterizing as the epicenter of Southwest Florida's real estate recovery.

"Existing inventory in Lakewood Ranch is way down," company president John Cannon said. "Over the past couple of years, buyers were able to scoop up bargains, but there are not as many of those any more."

At the same time, builders now are able to build houses for about the same price as those of resales because of the sharp decline in land and building costs.

"People are usually willing to pay a 10 percent premium for new construction," Cannon said. "They are finding that cost is offset by lower operating costs."

Cannon, who is also building a half-dozen luxury homes along the water, said the average price of his homes during the past six months has been $600,000 and the highest price was $2.5 million.

"A lot of people who were sitting on the sidelines waiting for the economy to improve are now feeling it's time to get on with their lives," Cannon said.

But "they're not going in for the 10,000-square-foot homes that they were buying five years ago," he said. "They are feeling more sensitive to the economic times and are not as inclined to be opulent."

There are about 160 homes under construction in Lakewood Ranch, where managers plan to raise by $8,000, or 10 percent, lots selling for $79,800, and by $18,000, or 14 percent, lots selling for $126,000. It would be the first time Lakewood Ranch has raised lot prices since 2006.

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