The Destin Log has come out with several columns this week detailing the past decade in real estate. Unlike the past two decades, the 2000s saw significant changes in property values, with steep increases during 2004 to 2007, and also more homebuyers. But, as many saw from 2007 to 2009, this wasn’t really a blessing to the local real estate market in any city. Those with adjustable rate mortgages, for example, saw their rates go too high starting in 2007 and many weren’t able to make payments. Couple this with the economic decline starting at the end of 2007, and the real estate market crashed. The present market, as we discussed last week, has an abundance of foreclosures and lowered property values.

The lower property values take the real estate market back to 2004 prices, and, with stricter lending regulations, the real estate bubble shouldn’t happen again. But, the decade over all, saw the most significant changes, according to a column written by Fraser Sherman. In 1999, for example, the real estate market in Destin – as well as in all cities – was stable and foreclosures and short sales both were unheard of. During the “bubble” starting in 2005, prices rose so much that the cheapest home in Destin at the time was about $260,000. The bubble also caused more development in Destin during the decade, and, now, developers have much less space to work with.

Businesses, or commercial real estate, hasn’t been so quick to recover, according to another column from the Destin Log and now faces more hurdles for the future. The change this decade in commercial real estate is that most businesses are geared toward tourists – not locals as much. Although rental properties increased over the course of 2009, businesses are now working harder to meet the needs of the tourism industry and also to combat the fallen real estate market.

2009 was seen as the bottom for the housing marketing, according to a column written by Fraser Sherman for the Destin Log. The year was partially the aftermath of the two years before, which included increased foreclosures and stalled commercial properties. As homeowners who had bought homes with adjustable rate mortgages from 2004 to 2006 realized they could no longer make their monthly payments – and this coupled with the fall of the economy starting in 2007 – the real estate market crashed and, as we saw in Jack Simpson’s column earlier this week, foreclosures increased and property values went down. But the lowered property values aren’t all bad – Destin homes and condos are now more affordable to the average vacationer.

Sherman mentions in his column that Destin is now seen as a destination for those in the South looking for a second home and, as a result, more affordably-priced properties in Destin are being bought. Although, looking at any real estate statistics, the first half of 2009 indicated the bottom of the market – no homes being sold and lowered property values – the second half of the year saw an increase in the amount of residential properties being sold. With stalled commercial developments, however, the prediction for commercial real estate, according to Sherman, is delayed a few years.

What could be attracting those to purchase homes in Destin? One reason is practical: The expansion of the local air force base has caused more to move to Destin. Aside from this, Destin has been listed as one of the top vacation destinations in both Southern Living and Frommer’s, with the latter recommending it as world-wide tourist destination for its value. But Frommer’s isn’t the only one to state this notion: Tourism, particularly the increase in rental properties over the summer, increased steadily through 2009.

A column by Jack Simpson in the Destin Log analyzed the trends for Destin real estate in 2009. In some sense, aside from the conversation Simpson is having with himself, the column is a review of most real estate in 2009 – not unique entirely to Destin and the Emerald Coast but also to real estate in general. Destin, in rentals, did see some significant positives over the year, which wasn’t mentioned in Simpson’s column and the end of the year also saw a rise on condo sales. In general, 2009 was the aftermath of the housing crisis that has been an issue since 2007. But, despite excessive foreclosures in Destin, what was seen in Destin wasn’t much different than in the rest of the nation – except for the slight upturn seen mid-year.

The main issue Simpson sees with the Destin housing market is the amount of foreclosures on the market, as well as significantly lower property values and higher insurance costs. While the latter has been due to hurricanes, both foreclosures and lowered property values are a direct result of the housing marketing crash. But, because Destin has seen an upswing in the amount of homes being bough during the second half of the year, it’s also somewhat beneficial, as now housing is more affordable in Destin. This, as Simpson also mentions, should be the goal for 2010: To make housing in Destin more affordable to those who should be buying homes.

Aside from purchasing homes in Destin area, another aspect of local real estate has some under fire by Simpson: beach renourishment. As we’ve seen in previous posts, the beaches along the Emerald Coast have been experiencing erosion and beach renourishment is supposed to combat this. As Destin’s primary asset to home owners and vacationers, the beaches are important in attracting people to Destin, but, unfortunately, the beaches being renourished, according to Simpson, are those that aren’t experiencing the most erosion.

You would think that adding a big-box store to an area wouldn’t count as real estate, but Wal-Mart is a different story. Wal-Mart can increase or decrease property values and the common conception is that it takes away from local businesses while, in some cases, not paying or paying very little taxes. A Wal-Mart is now in the works for South Walton and the quaint, locally-focused beach communities have mixed reactions, which can be read in an article from The Destin Log. Will adding a Wal-Mart to South Walton harm the community as a tourist attraction in any way?

Some of the arguments against adding a Wal-Mart to South Walton include:

• Lowered property values.
• Less traffic to local businesses, especially as the beach communities have more local stores and fewer big-box complexes.
• Preserving local character.
• The Destin Wal-Mart is already geared toward tourists, with beach souvenirs and t-shirt air brushing services inside the store.

Some of the pros? The locals don’t need to drive to Destin to go to a Wal-Mart. Adding a Wal-Mart, as long as it’s not on 30A, wouldn’t affect traffic in the community and might even add more jobs.

The question of adding a Wal-Mart to South Walton is similar to the question posed by adding casinos to Destin a month ago: Will it commercialize the area too much and take away part of the beach character? In the case of Destin, yes, casinos along the beach would significantly reduce the fishing industry the area is known for. As far as a Wal-Mart in South Walton is concerned, it, too, might detract from local businesses, including many specialty shops. Although the Gulf Coast has shopping centers like the Silver Sands Outlet Mall, South Walton doesn’t have the amount of big-box stores that Destin does and adding a Wal-Mart, which could lead to similar types of stores being added, might start to erode the local character and laid-back atmosphere of South Walton’s communities.