Florida land boom of the 1920s

The first real estate bubble in Florida was primarily caused by the economic prosperity of the 1920s coupled with a lack of knowledge about storm frequency and poor building standards.

Major investors and speculators such as Carl G. Fisher also left behind a new history of racially deed restricted properties that segregated cities for decades.

Finally, World War I cut off the rich from their seasons on the French Riviera, increasing the appeal of parts of the U.S. with a Mediterranean or Tropical climate.

[citation needed] The economic prosperity of the 1920s coupled with a lack of knowledge about storm frequency and the poor building standards used by boom developers set the conditions for the first real estate bubble in Florida.

[7][8] Developer Carl G. Fisher of Indiana became famous by purchasing a huge lighted billboard in New York's Times Square proclaiming "It's June In Miami".

[9] Fisher's publicity and investments along with those of concurrent pioneers Lummus and Collins correlated with rapidly rising prices, and the boom began.

[13] Jacksonville, the largest city in Florida, would not be as affected by the boom because municipal leaders had decided to work on expanding industry and commerce rather than tourism after World War I.

To make matters worse, in October 1925, the "Big Three" railroad companies operating in Florida—the Seaboard Air Line Railway, the Florida East Coast Railway, and the Atlantic Coast Line Railroad—called an embargo due to the rail traffic gridlock of building materials, permitting only foodstuffs, fuel, perishables, and essential commodities to enter or move within the state.

[17] Because the railroads were still embargoing non-essential shipments, it now became completely impossible to bring building supplies into the Miami area, and the city's image as a tropical paradise began to crumble.

"In the enforced lull which accompanied the efforts to unstopper the Miami Harbor," he wrote, "many a shipper in the North and many a builder in the South got a better grasp of what was actually taking place here.

[19][20][21] The 1926 hurricane destroyed "whatever public enthusiasm for Florida vacation properties and real estate development that remained," as there had been little preparation for the storm.

Large amounts of local debt financing through bonds worsened the economic situation in the state with most of it coming from the years of the land boom.