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Housing, insurance and health care — the forces driving South Florida's population changes

Key West lost 5% of its population between 2020-2023, making it the fastest shrinking city in South Florida. Parkland was the fastest growing cities in the region with its population expanding by 9%.
AP, Leslie Ovalle/WLRN
Key West lost 5% of its population between 2020-2023, making it the fastest shrinking city in South Florida. Parkland was the fastest growing cities in the region with its population expanding by 9%.

About 200 miles separate Key West and Parkland.

One dates back centuries, while the other is barely 50 years old. One holds itself up to be the model of modern suburban living. The other has, shall we say, a different reputation.

These two cities are on different ends of the spectrum of Florida’s relentless population growth. Parkland is the fastest growing city in South Florida with more than 20,000 residents since the COVID-19 pandemic. Its population has increased over 9%.

" To be honest, that's very exciting. It tells you that Parkland is a desirable city for people to move to," said Parkland Mayor Richard Walker.

Key West is at the other end. It experienced the sharpest drop in residents, losing 5% of its population between April 2020 and July 2023.

"Well, you know what? It makes sense," said Key West Mayor Teri Johnston.

The tale of two cities, indeed.

The fastest growing city in Florida with at least 20,000 residents between 2020 and 2023 was Haines City. "Heart of Florida" is what it says on the city seal. And it is. Haines City is about 40 miles south of Orlando. Over three years, its population grew by 35%.

In South Florida, the dividing line between more people moving in and those leaving is the Broward — Miami-Dade county line. North of that, in Broward and Palm Beach counties, the population increased. South in Miami-Dade and Monroe counties, more people moved out.

Key West and Parkland are examples of this divide.

Even though one is growing and one is shrinking, the two cities share some of the same driving forces behind their population changes — housing supply and home prices. Johnston describes her city of Key West as a two-by-four mile neighborhood.

"Our neighborhoods (are) the fabric of Key West (and) are being eroded by the nightly rentals — AirBNBs — things of that nature. And that’s what concerns me," she said in an interview with WLRN from her office

READ MORE: South Florida home sales 'defy gravity' as cash remains king

While Key West is a vacation destination and is hemmed in on all sides by water, Parkland has been adding areas such as what’s known as The Wedge. It includes five single family home developments, including one that is 55-plus.

"We have a lot of people who took advantage of the higher prices and maybe they were empty nesters and they decided to move. That makes housing available for younger families that have children," said Walker. "And, for us, one of the things that is important are the schools."

More homes are coming to Parkland. The city bought part of the old Heron Bay Golf Course about a year and a half ago. The course hosted the Honda Classic for six years but it closed in 2019. Parkland paid $25.4 million for 65 acres of the course. It then sold almost two dozen acres to a homebuilder for $19.5 million. But these won’t be starter homes. No more than 52 luxury homes are expected to be spread across 21 acres. The remaining area is expected to include some commercial development like shopping and restaurants.

"We bought that to kind of limit how much residential we can have in there," said Walker. "It also gives us an opportunity to provide additional amenities to our residents. We don't have a lot of shopping restaurants. And now we're going to have that center hub in our city, which will make sure Parkland has a little bit of everything."

And the city isn't finished. Walker and the city have their eyes on the largest undeveloped tract of land in Broward County. Hendrix Farms has 739 acres sitting between Parkland’s northwest border and Loxahatchee Road.

"We will have additional supply but whether it's three years, four years, 10 years from now, we don't really know that," he said.

In Key West, Johnston hopes to address their lack of housing supply by asking voters to change the city charter allowing it to buy property for affordable housing. Currently, the city can only buy property if voters okay the purchase through a ballot referendum.

"If we want our employees to stay here and live here in the city of Key West, raise their families here, send their kids to our schools, then we've got to do something to impact that. That falls into the category of housing," she said.

Premium prices

Adding to the cost of housing is property insurance, regardless if it's Key West or Parkland.

Florida homeowners already pay the highest premium for home insurance. One new analysis puts the average home insurance rate in Florida close to $11,000 a year. The report from insurance price comparison website Insurify points out that the six most expensive cities for home insurance in the country are in South Florida.

Walker recognizes the role home insurance premiums play with a rising cost of living, but said "it's out of the control of local government."

Key West has the additional challenge that the taxpayer-backed Citizens Property Insurance, the insurer of last resort, often is the only insurer. About four out of every five home insurance policy in the Keys is with Citizens.

Johnston pointed out finding affording a home is difficult enough in Key West, where the median price of an existing home for sale is $1.5 million according to the National Association of Realtors.

Then there is the price to protect the home. "Our insurance rates in Monroe County are astronomical. When you tack on windstorm insurance and flood insurance, often times that's more than your mortgage payment. That takes our young families out of eligibility to own in the city of Key West," Johnston said.

Key West is in good company of South Florida cities shrinking since the pandemic. Others with high housing costs saw a drop in population. Miami Beach and Aventura lost about 4% of their residents. Sunny Isles Beach and Coral Gables shrunk by about 2%.

Care costs

Health care is another challenge for keeping residents at the end of the Overseas Highway. The only cancer treatment center in the Keys closed last summer.

"There's just some services that we've not been able to sustain in the city of Key West because of housing, because of qualified labor force in order to support that entity," Johnston said. "We're really struggling in those areas."

READ MORE: 'Can we live here?': Lower Keys officials, residents anxious about medical care services

It's a challenge Parkland does not have to contend with thanks to its location bordering Broward and Palm Beach counties. "We're right next to Coral Springs and Boca Raton," said Walker. "There's plenty of opportunities for healthcare."

Meantime, the populations of communities at the other end of South Florida like Parkland are growing. West Palm Beach and Plantation grew by about 5%. Doral was the fastest growing city in Miami-Dade County, adding about 4.5% percent more people since the pandemic. And the city of Miami — the largest city in the region — added 3% more people.

Tom Hudson is WLRN's Senior Economics Editor and Special Correspondent.
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