Lehigh returns

Few areas of the state felt the homebuilding frenzy and collapse as dramatically as Lehigh Acres.

The unincorporated area of Lee County east of Fort Myers suffered through thousands of foreclosures, and homebuilders shut down operations there during the downturn. In a widely quoted February 2009 article, the New York Times labeled Lehigh Acres as “the American dream in high reverse.”
Now, long after the media glare on foreclosures has faded, Lehigh Acres is shifting gears again as the housing rebound spreads inland from pricey coastal areas. It's another indication that the homebuilding recovery is well underway in Southwest Florida.
Several homebuilders have restarted operations in Lehigh Acres and more are on the way as prices rise and foreclosures decline. They're aiming for buyers looking for a new home priced less than $200,000.
“In 2012, our top sales agent in our area was in Lehigh Acres,” says Kristi Williams, sales manager for Adams Homes' Fort Myers region that stretches from Lee to south Sarasota counties.
Adams Homes was the first significant homebuilder to return to Lehigh Acres when it started selling homes there in 2011. Since then, D.R. Horton's Express Homes opened The Grove, a community in the heart of Lehigh Acres that will have about 400 homes when it's completed. Close to Interstate 75, Lennar is building homes at Olympia Pointe.
A big reason for Lehigh's recovery is affordability. You can buy a new home for less than $200,000, well below prices for new homes in other areas of Lee and Collier counties. “There's a huge niche in the market for those who focus on selling to that first-time homebuyer,” says Randy Thibaut, CEO of Land Solutions in Fort Myers.
While foreclosures remain, many of the better-quality foreclosed homes have been sold and prices are rising. Indeed, the median price of an existing home sold in July in Lehigh Acres was $96,500, a 17% increase over the $82,250 median price in July 2013, according to the Realtor Association of Greater Fort Myers and The Beach.
“It's no competition against a brand-new home,” says Williams. “You see so much new construction going on, and it's because the inventory is no longer there.”

Boom and bust
Lehigh Acres began its life in the 1950s like many other Florida communities, as a huge speculative bet. Developer Lee Ratner bought 100 square miles of scrub east of Fort Myers and subdivided it into thousands of quarter- and half-acre lots, which he sold to northern speculators and retirees.
During the boom that peaked in 2005, lots in Lehigh Acres that had sold for a few thousand dollars spiked to $50,000 or more. Homebuilders such as First Home Builders of Florida rushed into the area, building thousands of homes for investors who flipped them. “It was a totally inflated market,” says Michael Reitmann, the longtime head of the Lee Building Industry Association and now a consultant for the trade group.
Everyone knows what ensued: Prices collapsed during the bust and foreclosures swamped the market. The construction industry's woes exacerbated the situation because thousands of workers who lived there moved away.
But as the housing recovery began to take hold a few years ago, home and residential-land prices in surrounding areas began to rise. “We are in the process of a new cycle,” says Joyce Gregory, broker and manager of Market America Realty Network in Lehigh Acres.
“We've seen an influx of people buying lots,” Gregory says. Some buyers are investors and others plan to build homes on them, she says.