Soaring utility costs starting to impact local real estate market

INDIAN RIVER COUNTY — Savvy buyers looking for real estate deals are asking more questions than ever about what their total monthly household expenses would be – and utilities are becoming a factor, realtors said.”A lot of people are paying more for their electric bill than they do for their mortgage,” said Matilde Sorensen broker and co-owner of Dale Sorensen Real Estate. This summer’s surge in City of Vero Beach electric bills due to high power cost adjustments is only part of the story. Combined water and sewer rates have already gone up by 18 percent and will rise by another 18 percent five months from now. To meet growing overhead costs, the city is expected to impose more increases each until at least 2013, when the result will be a more than 50 percent increase over last month’s rates for water, sewer and irrigation water. There has also been talk of a small annual cost-of-living increase in base rates after 2013. Seasonal residents can no longer disconnect service and avoid base rates while they’re away and electric usage costs may also go to a seasonal rate adjustment in October 2010 if proposals on the table are accepted. All of this adds up to a blow to the pocketbook and, potentially, the decision to spend less on a house to offset these and other fixed costs.Local businesses, the unemployed and people on fixed incomes were the first to feel the pain from having their monthly output swell way beyond what they were accustomed to this summer. But as the year drags on and utility bills continue to pinch even the area’s most affluent residents, the grumbling and outrage has not been lost on prospective home buyers.Charlotte Terry of Charlotte Terry Real Estate based at Alex MacWilliam Real Estate, works almost exclusively as a buyers’ agent and has for nearly two decades.”I have heard people asking questions about utilities; it is beginning to become a concern,” Terry said. “It is playing a part because they all know about it and they’re all reading the papers.”Many residents are banking on just surviving until January, which is when city officials are promising the electric situation will right itself. To quell the revolt of the average citizen drowning under bills which have nearly doubled, the city has told rate payers that they should see their bills go down by around 20 percent after the new power-buying deal with Orlando Utilities Commission goes into effect on January 1.Lower power costs via the OUC contract are predicted to offset the offset the 12.5 percent proposed base rate increase, which has been reviewed by the Public Service Commission and is expected to come to a vote by the Vero Beach City Council later this month.While those coming in are asking about the price of utilities, Sorensen said she is seeing an increase in business from locals looking to flee the high prices.”People are putting their homes up for sale and moving away to places like North Carolina where the cost of living is cheaper,” she said. “Especially retired people looking at their incomes as compared to the taxes and utilities and cost of living here; they don’t want to pay that for the rest of their lives.”Albert VanDerveer, a retired CPA, said he can do the math, and for him, even if he wanted to leave Vero and go to a cheaper place,  he doesn’t think he can sell his barrier island home. “Who would want to buy my house with a $700 utility bill?” he asked last week after hearing city council candidates talk about utility issues.

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