Mike Myhand (left) and Robert Thompson work on a home remodeling project in Atlantic Beach. -- Rick Wilson/Staff

Beach boom
Skyrocketing real estate prices have made Atlantic Beach THE place to live these days

By Roger Bull
Times-Union staff writer

Well, here's another reason to hate people who live at the Beaches: Their houses are probably worth a lot more than yours.

Home prices at the Beaches have gone up dramatically in the past few years.

"If something comes on the market for $250,000, something decent, it's gone," said Jan Shields, who has lived in Atlantic Beach for 18 years and sold real estate at the Beaches for 15 years.

"I've never seen anything like it," she said.

Lea Underwood has been selling real estate there since 1983.

"So I've really watched it grow," she said. "But I've never seen it like this. The beach has always been a better market. We've always been pretty much on the incline, but nothing this dramatic."

Property all over the Beaches has gone up, but it's in old Atlantic Beach -- the area north of Atlantic Boulevard, between Seminole Road and the ocean -- where it's really skyrocketing. It's on those funky, eclectic streets where the beach cottages are bringing the most money, where homes have more than doubled in value in less than 10 years.

Those little cottages and bungalows that were once second homes for people who lived in town are becoming valuable, but they're also getting remodeled and enlarged into homes that are much more grand, giving something of a new look to the old neighborhood. Some houses have even been torn down to make way for larger, more modern homes.

"Old Atlantic Beach is the prime place for that," Underwood said. "That's the hottest market. I have a girlfriend who owns a house on 10th Street, just a little beach cottage. Her home five years ago might have been $125,000 to 130,000. Now it's almost in the $300,000 range."

Realtors and residents talk with amazement about the prices.

Real estate agent Shields recently sold a home on Sixth Street -- a little two-bedroom, one-bath, 1,100-square-foot concrete block house -- for $230,000.

"And there was more than one bidder," she said. "Another on Eighth Street, the same size, sold for the same price, and it needed a lot of work."

People talk of small, three-bedroom, two-bath homes going for $260,000. That price will get you a five-bedroom, 3,000-square-foot house in Mandarin or Orange Park Country Club. And the Mandarin home is on water, with a dock and everything.

Oceanfront condos in The Cloisters, Shields said, sold for about $250,000 five years ago.

"The last one sold for $480,000," she said. "The only one on the market now has an asking price of $635,000."

And oceanfront? Forget about that.

Underwood said that 10 years ago, you might have been able to buy an oceanfront home in Atlantic Beach for about $300,000.

But the cheapest sale she's seen recently is $1.1 million.

"And it's an old house," she said. "They'll eventually build a new one there."

That's happening, too -- people paying top dollar for a home and then tearing it down.

The Partow family -- Shelly (left), Arianna, 5, Alec, 10 months, and Ramin -- decided to enlarge their Atlantic Beach home rather than move to a bigger place. -- Rick Wilson/Staff

"Drive down 11th Street," Shields said. "Someone paid $280,000 for a concrete block house and tore it down."

Most of the new buyers moving in are coming from out of town, Underwood said.

"They're young -- late 20s, early 30s," Underwood said. "And they're buying $200-,

$300-, $400,000 houses. I can't believe how many people can come up with that kind of money. A lot of times it's double incomes, but a lot of times it's not."

The biggest problem Shields said, is the scarcity of homes.

"There's hardly anything to sell," Shields said. "I have people who want to move in, but I don't have anything to show them."

She said that few homeowners are cashing in by selling their beach homes to buy bigger homes for less money elsewhere.

But Kirk Farber sure thought about it. He came oh-so-close to selling the home he's owned and lived in on 10th Street in Atlantic Beach since 1985.

"My mom's a Realtor; she became one about seven years ago," he said. "So every time I'd talk to her, she'd tell me that prices in Atlantic Beach and San Marco are going crazy."

He's refinanced a couple of times over the years, each time amazed at the appraisal. He bought it for $72,000, but two months ago, it was appraised at $290,000. He's sure he could get more than $300,000 for the 1,800-square-foot block home with three bedrooms and two baths.

Farber said he's taken a lot of money out of his house already by refinancing. He's put some back in remodeling, but he's also paid business debts, invested in the stock market and started a college fund for his 2-year-old.

Still, he figures that if he sold his house, he would walk out with $150,000.

"And that's not bad," he said.

Last year, he decided to take the money and run across the Intracoastal. He and his wife signed a contract to buy a house (more house, less money) off Hodges Boulevard.

But then there was talk of being transferred to Arizona. He was with an Internet startup company that was moving its employees out to Tucson. Farber, a database manager and trainer, talked management into letting him stay in Florida and work from home.

But the uncertainty of the situation made him pull out of the contract for the new house and stay in Atlantic Beach. Two weeks ago, the company downsized and most of the employees, including Farber, lost their jobs.

"That's the dot-com world," he said.

He's not worried about finding something else; it's still the dot-com economy. But the past year has made him appreciate where he lives.

"I started walking my dog a lot and realized how much I love the beach, how fortunate my wife and I are to live here. We still talk about moving, about getting more bang for the buck, but we're two blocks from the beach."

So the Farbers are going ahead with work on the house -- adding a driveway and enlarging the porch.

And that's what a lot of Atlantic Beach homeowners are doing.

"We can tell people to improve all you want," Shields said, "and you'll still get your money out."

That's what Ramin and Shelly Partow did. He's one of the original partners in Flamers, which has grown from one burger stand in The Jacksonville Landing food court to more than 70 locations around the country. They've lived on 11th Street for eight years and recently looked into moving to Ponte Vedra Beach, but they decided to stay.

Ramin Partow talked about the financial end of it -- "It's such a diverse-value neighborhood. A few blocks away, you've got oceanfront homes at $1.5 million plus."

And he talked about the ambience.

"It's a closely knit neighborhood. And you've got accessibility to the beach that you don't have in Ponte Vedra."

The Partows decided to remodel in a very major way. They went forward to the street with an addition, went up to a second story, added a garage. Their old 2,600-square-foot brick home is now a 4,600-square-foot stucco house. Partow said it cost about $100 a square foot.

But it's done, except for the front yard, which is awaiting landscaping. Partow stood in the front yard and pointed out similar projects. Across the street to the left was once a 1,600-square-foot block house -- now it's 4,000 square feet and shingled. Across the street to the right, the old house was torn down and a new gray stucco built.

Just around the corner on 12th Street, George Cummings stood watering his lawn and couldn't help but chuckle at it all. He's 79 years old and has lived there since 1955, when he built his home after moving from New Jersey with Prudential Insurance Co. He has a pretty good handle on selling prices. He checks out real estate transactions in the Times-Union; he even goes online to the Duval County Property Appraiser's database (pawww.coj.net/pub/property/lookup.htm) to see what sold for what.

"I see homes with a lot less house than mine going for $250,000," he said.

He pointed out one home on his street that has changed hands often over the years, the last time for more than $300,000.

"And every time someone else moves in," he said, "there's a line of plumbers and electricians out the door.

"But land, they don't make anymore -- that's the old saying," Cumming said. "If someone offered me $300,000, would I take it? No. Where would I go? I've got three children, eight grandchildren and two great-grandchildren. This is the ideal place for them to come in the summer."

There's the question, of course, if the higher prices will change the eclectic nature of Atlantic Beach. But Shields said she hasn't seen the demographics change much so far.

"Incomes are going up," she said. "A lot of money has been made in the stock market. Interest rates are down. And a lot of young people are making a lot more money than they used to. People like the quiet type of prominence instead of a glitzy, gated community.

"But I'm sure there's not nearly as many rentals."

She said that while rents have gone up, they haven't kept pace with sale prices.

In other words, that home that sold for $130,000 five years ago would command enough rent to pay the mortgage. But that house might be $280,000 now, and the rent hasn't more than doubled.

Former Atlantic Beach mayor Lyman Fletcher said the basic nature of the town hasn't changed much.

"I suppose that over time, it could affect the diversity," Fletcher said. "But I haven't seen anything dramatic. You see a lot affluence. People have more money, but you see people more involved in the community.

"I think the things that have always made this area special," Fletcher said, "respect for the environment, respect for the trees and the intimacy -- I would hope that most of the people moving here are coming for those reasons."