The Herald Tribune reports from Florida. "New home construction, the linchpin of this North Port's spending plans, has slowed to a comparative standstill and even optimists say these doldrums are far from over. The massive drop in home building, which started in April, has left everyone from City Hall staffers to spec home buyers scrambling to adjust."

"Impact fees, used to pay for capital projects such as road widenings and new parks, account for $28 million of this year's budget. To collect that much money would take about 3,900 houses and 50 large commercial projects. The city is nowhere near that pace so far, being on track to issue about 1,000 home permits this budget year."

"'Whether we did (cut) enough or not remains to be seen,' said City Manager Steven Crowell."

"The real estate downturn has been a disappointment beyond City Hall. Rich Deeds, who lives in Pennsylvania, jumped into the North Port spec housing market right before this year's precipitous drop. Now he's sitting on two new houses in the city."

"He tried to sell one on eBay this month but didn't get a single bid. Now he's spending $4,500 on Florida mortgages every month. 'I expected a leveling out,' he said. 'I didn't expect it to take a plunge.'"

The St Petersburg Times. "'We were actually crazy,' said broker Dan Richard. 'It seemed like it was almost out of control, people flipping houses. It's much slower now.'"

"That, of course, is the big story of 2006, the slowing of the housing market, though by some accounts those terms don't begin to describe it. 'This thing has almost collapsed,' Per Berglund, a senior economist with Moody's Economy.com said."

"The most telling statistic documenting this reversal is the number of permits the county's Development Department issued for construction of new homes. That dropped from 4,185 in 2005, a record high, to 2,765 through Dec. 19 of this year, with a much more pronounced decline in recent months."

"But people in the business of building and selling homes don't need to see those numbers to know how things have changed. They can tell by the way they go about their jobs."

"As the pace of building slackened in late 2005, builders had an easier time finding materials and workers to complete jobs. Then, toward the end of 2006, said Mark Vallery, owner of Vallery Custom Homes of Clermont, subcontractors' prices began to drop substantially because they needed work."

"'Basically, they don't have anything to do, as opposed to two years ago when we had to beg them and offer them bonuses to get any work done,' said Valler."

"The reduced labor costs mean that, finally, the prices of homes have started to drop. The least expensive houses he sells in Southern Hills, called cottages, have recently been repriced at $298,900, down from $350,000. Vallery, whose sales in 2006 dropped 70 percent from 2005, said he has reduced the prices of other homes in the golf course development by a full 20 percent."

"'You hear some people say, 'My neighbor sold his for this much a year and a half ago, and I have the exact same house,' said Richard, who said sales in his offices declined 30 percent this year. 'We have to tell them, well, that was a year and a half ago. ... That's not working anymore.'"

The Miami Herald. "The squeeze on South Florida renters might ease because more rentals are coming onto the market. With condo sales slow, some condo investors are putting their units up for rent instead. And others who converted their rentals into condos in the hope of quick gains are deciding to convert them back."

"While the size of this 'shadow market' of inventory is hard to gauge, it is having an impact."

"'The shadow market has definitely affected the rental market. Whereas a year and a half ago the market was really tight, now you find an abundance of rental property,' said Jay Massirman, a former vice chairman at commercial brokerage CB Richard Ellis."

"'Six months ago a renter could not find a concession anywhere. Now you can find a half-month or month offered for free in some places,' said Kevin Judd, VP of Apartment Realty Advisors in Boca Raton."

"Alan Ojeda, among the few developers to build an apartment rental tower in South Florida in recent years, said fully two-thirds of rentals converted into condos are now going right back in the rental market. 'It is going back as rental supply, but under a different owner,' he said."

"Some 4,000 apartments set to be converted to condos have already reverted back to rentals, according to McCabe Research & Consulting, who has long predicted a meltdown in the condo market. The company only tracks market rate apartments of 100 units or more."

"Earlier this year Pembroke Cove, a rental community in Pembroke Pines, was set to be sold as condos. Now the 302-unit complex is renting again."

"Raul Nobili, VP of a small Miami Gardens company that owns a handful of Miami-Dade rental complexes, explains the change: 'I used to get three calls a week from buyers wanting to buy the apartments and turn them into condos. Now I get two calls a week and they ask if we are interested in buying other rental buildings.'"

"The new condos are spinning off rentals as well. Roughly 10 percent of the units at Neo Vertika, a recently-completed 443-unit condo along the Miami River, are for rent. With thousands of condos under construction across South Florida, the number of new rentals could quickly rise."