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article number 238
article date 05-28-2013
copyright 2013 by Author else SaltOfAmerica
We Get Drawn Into the Florida Land Boom … Then Bust, 1920s
by Fredrick Lewis Allen

From the 1931 book, Only Yesterday.

. . . “Go to Florida—
“Where enterprise is enthroned—
“Where you sit and watch at twilight the fronds of the graceful palm, latticed against the fading gold of the sun-kissed sky—
“Where sun, moon and stars, at eventide, stage a welcome constituting the glorious galaxy of the firmament—
“Where the whispering breeze springs fresh from the lap of Caribbean and woos with elusive cadence like unto a mother’s lullaby—
“Where the silver cycle is heaven’s lavalier, and the full orbit [sic] its glorious pendant.”

THIS outburst of unbuttoned rhetoric was written in the autumn of 1925, when the Scopes trial was receding into memory, Santa Barbara was steadying itself from the shock of earthquake, Red Grange was plunging to fame, the cornerstone of Bishop Manning’s house of prayer for all people was about to be laid, Brigadier-General Smedley Butler was wishing he had never undertaken to mop up Philadelphia, ‘The Man Nobody Knows’ was selling its ten thousands—and the Florida boom was at its height.

The quotation is not, as you might imagine, from the collected lyrics of an enraptured schoolgirl, but from the conclusion of an article written for the Miamian by the vice-president of a bank. It faintly suggests what happened to the mental processes of supposedly hard-headed men and women when they were exposed to the most delirious fever of real-estate speculation which had attacked the United States in ninety years.

There was nothing languorous about the atmosphere of tropical Miami during that memorable summer and autumn of 1925. The whole city had become one frenzied real-estate exchange. There were said to be 2,000 real-estate offices and 25,000 agents marketing house-lots or acreage. The shirt-sleeved crowds hurrying to and fro under the widely advertised Florida sun talked of binders and options and water-frontages and hundred-thousand-dollar profits; the city fathers had been forced to pass an ordinance forbidding the sale of property in the street, or even the showing of a map, to prevent inordinate traffic congestion.

Downtown Miami.

The warm air vibrated with the clatter of riveters, for the steel skeletons of skyscrapers were rising to give Miami a skyline appropriate to its metropolitan destiny. Motor-busses roared down Flagler Street, carrying “prospects” on free trips to watch dredges and steam-shovels converting the outlying mangrove swamps and the sandbars of the Bay of Biscayne into gorgeous Venetian cities for the American home-makers and pleasure-seekers of the future.

The Dixie Highway was clogged with automobiles from every part of the country; a traveler caught in a traffic jam counted the license-plates of eighteen states among the sedans and flivvers waiting in line. Hotels were overcrowded. People were sleeping wherever they could lay their heads, in station waiting-rooms or in automobiles.

The railroads had been forced to place an embargo on imperishable freight in order to avert the danger of famine; building materials were now being imported by water and the harbor bristled with shipping. Fresh vegetables were a rarity, the public utilities of the city were trying desperately to meet the suddenly multiplied demand for electricity and gas and telephone service, and there were recurrent shortages of ice.

How Miami grew! In 1920 its population had been only 30,000. According to the state census of 1925 it had jumped to 75,000—and probably if one had counted the newcomers of the succeeding months and Miami’s share of the visitors who swarmed down to Florida from the North in one of the mightiest popular migrations of all time, the figure would have been nearer 150,000.

Crowds in a Miami Park.

And this, one was told, was only a beginning. Had not S. Davies Warfield, president of the Seaboard Air Line Railway, been quoted as predicting for Miami a population of a million within the next ten years? Did not the Governor of Florida, the Honorable John W. Martin, assert that “marvelous as is the wonder-story of Florida’s recent achievements, these are but heralds of the dawn”?

Everybody was making money on land, prices were climbing to incredible heights, and those who came to scoff remained to speculate.

Nor was Miami alone booming. The whole strip of coast line from Palm Beach southward was being developed into an American Riviera; for sixty-odd miles it was being rapidly staked out into fifty-foot lots. The fever had spread to Tampa, Sarasota, St. Petersburg, and other cities and towns on the West Coast. People were scrambling for lots along Lake Okeechobee, about Sanford, all through the state; even in Jacksonville, near its northern limit, the “Believers in Jacksonville” were planning a campaign which would bring their city its due in growth and riches.


For this amazing boom, which had gradually been gathering headway for several years but had not become sensational until 1924, there were a number of causes. Let us list them categorically.

1. First of all, of course, the climate—Florida’s unanswerable argument.

2. The accessibility of the state to the populous cities of the Northeast—an advantage which Southern California could not well deny.

3. The automobile, which was rapidly making America into a nation of nomads; teaching all manner of men and women to explore their country, and enabling even the small farmer, the summer-boarding-house keeper, and the garage man to pack their families into flivvers and tour southward from auto-camp to auto-camp for a winter of sunny leisure.

4. The abounding confidence engendered by Coolidge Prosperity, which persuaded the four-thousand-dollar-a-year salesman that in some magical way he too might tomorrow be able to buy a fine house and all the good things of earth.

5. A paradoxical, widespread, but only half-acknowledged revolt against the very urbanization and industrialization of the country, the very concentration upon work, the very routine and smoke and congestion and twentieth-century standardization of living upon which Coolidge Prosperity was based. These things might bring the American business man money, but to spend it he longed to escape from them—into the free sunshine of the remembered countryside, into the easy-going life and beauty of the European past, into some never-never land which combined American sport and comfort with Latin glamour—a Venice equipped with bathtubs and electric ice-boxes, a Seville provided with three eighteen-hole golf courses.

6. The example of Southern California, which had advertised its climate at the top of its lungs and had prospered by so doing: why, argued the Floridians, couldn’t Florida do likewise?

7. And finally, another result of Coolidge Prosperity: not only did John Jones expect that presently he might be able to afford a house at Boca Raton and a vacation-time of tarpon-fishing or polo, but he also was fed on stories of bold business enterprise and sudden wealth until he was ready to believe that the craziest real-estate development might be the gold-mine which would work this miracle for him.

Crazy real-estate developments? But were they crazy? By 1925 few of them looked so any longer. The men whose fantastic projects had seemed in 1923 to be evidences of megalomania were now coining millions: by the pragmatic test they were not madmen but—as the advertisements put it—inspired dreamers. Coral Gables, Hollywood-by-the Sea, Miami Beach, Davis Islands—there they stood: mere patterns on a blue-print no longer, but actual cities of brick and concrete and stucco; unfinished, to be sure, but growing with amazing speed, while prospects stood in line to buy and every square foot within their limits leaped in price.


Long years before, a retired Congregational minister named Merrick had bought cheap land outside Miami, built a many-gabled house out of coral rock, and called it “Coral Gables.” Now his son, George Edgar Merrick, had added to this parcel of land and was building what the advertisements called “America’s Most Beautiful Suburb.” The plan was enticing, for Merrick had had sense enough to insist upon a uniform type of architecture—what he called a “modified Mediterranean” style.

By 1926 his development, which had incorporated itself as the City of Coral Gables, contained more than two thousand houses built or building, with “a bustling business center, schools, banks, hotels, apartment houses and club houses”; with shady streets, lagoons, and anchorages. Merrick advertised boldly and in original ways: at one time he engaged William Jennings Bryan to sit under a sun-umbrella on a raft in a lagoon and lecture (at a handsome price) to the crowds on the shore—not upon the Prince of Peace or the Cross of Gold, but upon the Florida climate. (Bryan’s tribute to sunshine was followed with dancing by Gilda Gray.)

Merrick also knew how to make a romantic virtue of necessity: having low-lying land to drain and build on, he dug canals and imported real gondolas and gondoliers from Venice. The Miami-Biltmore Hotel at Coral Gables rose to a height of twenty-six stories, the country club had two eighteen-hole golf courses, and Merrick was making further audacious plans for a great casino, a yacht club, and a University of Miami.

“Ten years of hard work, a hundred millions of hard money, is what George Merrick plans to spend before he rests,” wrote Rex Beach in a brochure on Coral Gables. “Who can envisage what ten years will bring to that wonderland of Ponce de Leon’s? Not you nor I. Nor Mr. Merrick, with all his soaring vision.” (Alas for soaring vision! Among the things which ten years were to bring was an advertisement in the New York Times reminding the holders of nine series of bonds of the City of Coral Gables that the city had been “in default of the payment of principal and interest of a greater part of the above bonds since July 1, 1930.”)

Golfing fun in Coral Gables.

There were other miracle-workers besides Merrick. Miami Beach had been a mangrove swamp until Carl G. Fisher cut down the trees, buried their stumps under five feet of sand, fashioned lagoons and islands, built villas and hotels, and—so it was said—made nearly forty million dollars selling lots. Joseph W. Young built Hollywood-by-the- Sea on the same grand scale, and when the freight embargo cut off his supply of building materials, bought his own seagoing fleet to fetch them to his growing “city.”

Over on the West Coast, D. P. Davis bought two small islets in the bay at Tampa—“two small marshy clumps of mangrove, almost submerged at high tide”—and by dredging and piling sand, raised up an island on which he built paved streets, hotels, houses. On the first day when Davis offered his lots to the public he sold three million dollars’ worth—though at that time it is said that not a single dredge had begun to scoop up sand!

Yes, the public bought. By 1925 they were buying anything, anywhere, so long as it was in Florida. One had only to announce a new development, be it honest or fraudulent, be it on the Atlantic Ocean or deep in the wasteland of the interior, to set people scrambling for house lots. “Manhattan Estates” was advertised as being “not more than three-fourths of a mile from the prosperous and fast-growing city of Nettie”; there was no such city as Nettie, the name being that of an abandoned turpentine camp, yet people bought.

Investigators of the claims made for “Melbourne Gardens” tried to find the place, found themselves driving along a trail “through prairie muck land, with a few trees and small clumps of palmetto,” and were hopelessly mired in the mud three miles short of their destination. But still the public bought, here and elsewhere, blindly, trustingly,—natives of Florida, visitors to Florida, and good citizens of Ohio and Massachusetts and Wisconsin who had never been near Florida but made out their checks for lots in what they were told was to be “another Coral Gables” or was “next to the right of way of the new railroad” or was to be a “twenty-million-dollar city.”


The stories of prodigious profits made in Florida land were sufficient bait. A lot in the business center of Miami Beach had sold for $800 in the early days of the development and had resold for $150,000 in 1924. For a strip of land in Palm Beach, a New York lawyer had been offered $240,000 some eight or ten years before the boom; in 1923 he finally accepted $800,000 for it; the next year the strip of land was broken up into building lots and disposed of at an aggregate price of $1,500,000; and in 1925 there were those who claimed that its value had risen to $4,000,000.

A poor woman who had bought a piece of land near Miami in 1896 for $25 was able to sell it in 1925 for $150,000. Such tales were legion; every visitor to the Gold Coast could pick them up by the dozen; and many if not most of them were quite true—though the profits were largely on paper. No wonder the rush for Florida land justified the current anecdote of a native saying to a visitor, “Want to buy a lot?” and the visitor at once replying, “Sold.”

Speculation was easy—and quick. No long delays while titles were being investigated and deeds recorded; such tiresome formalities were postponed. The prevalent method of sale was thus described by Walter C. Hill of the Retail Credit Company of Atlanta in the Inspection Report issued by his concern: “Lots are bought from blueprints. They look better that way Around Miami, subdivisions, except the very large ones, are often sold out the first day of sale. Advertisements appear describing the location, extent, special features, and approximate price of the lots.

Reservations are accepted. This requires a check for 10 per cent of the price of the lot the buyer expects to select. On the first day of sale, at the promoter’s office in town, the reservations are called out in order, and the buyer steps up and, from a beautifully drawn blueprint, with lots and dimensions and prices clearly shown, selects a lot or lots, gets a receipt in the form of a ‘binder’ describing it, and has the thrill of seeing ‘Sold’ stamped in the blue-lined square which represents his lot, a space usually fifty by a hundred feet of Florida soil or swamp.

There are instances where these first-day sales have gone into several millions of dollars. And the prices! . . . Inside lots from $8,000 to $20,000. Water-front lots from $15,000 to $25,000. Seashore lots from $20,000 to $75,000. And these are not in Miami. They are miles out—ten miles out, fifteen miles out, and thirty miles out.”

Selling land was easy, even to a whole group of people. 10 percent down and no credit checks.

The binder, of course, did not complete the transaction. But few people worried much about the further payments which were to come. Nine buyers out of ten bought their lots with only one idea, to resell, and hoped to pass along their binders to other people at a neat profit before even the first payment fell due at the end of thirty days. There was an immense traffic in binders—immense and profitable.

Steadily, during that feverish summer and autumn of 1925, the hatching of new plans for vast developments continued. A great many of them, apparently, were intended to be occupied by what the advertisers of Miami Beach called “America’s wealthiest sportsmen, devotees of yachting and the other expensive sports,” and the advertisers of Boca Raton called “the world of international wealth that dominates finance and industry . . . that sets fashions the world of large affairs, smart society and leisured ease.” Few of those in the land-rush seemed to question whether there would be enough devotees of yachting and men and women of leisured ease to go round.

Everywhere vast new hotels, apartment houses, casinos were being projected. At the height of the fury of building a visitor to West Palm Beach noticed a large vacant lot almost completely covered with bathtubs. The tubs had apparently been there some time; the crates which surrounded them were well weathered. The lot, he was informed, was to be the site of “one of the most magnificent apartment buildings in the South”—but the freight embargo had held up the contractor’s building material and only the bathtubs had arrived!

Throughout Florida resounded the slogans and hyperboles of boundless confidence. The advertising columns shrieked with them, those swollen advertising columns which enabled the Miami Daily News, one day in the summer of 1925, to print an issue of 504 pages, the largest in newspaper history, and enabled the Miami Herald to carry a larger volume of advertising in 1925 than any paper anywhere had ever before carried in a year.

Miami was not only “The Wonder City,” it was also “The Fair White Goddess of Cities,” “The World’s Playground,” and “The City Invincible.” Fort Lauderdale became “The Tropical Wonderland,” Orlando “The City Beautiful,” and Sanford “The City Substantial.”


Daily the turgid stream of rhetoric poured forth to the glory of Florida. It reached its climax, perhaps, ‘in the joint proclamation issued by the mayors of Miami, Miami Beach, Hialeah, and Coral Gables (who modestly referred to their county as “the most Richly Blessed Community of the most Bountifully Endowed State of the most Highly Enterprising People of the Universe”), setting forth the last day of 1925 and the first two days of 1926 as “The Fiesta of the American Tropics” —”our Season of Fiesta when Love, Good Fellowship, Merrymaking, and Wholesome Sport shall prevail throughout Our Domains.”

The mayors promised that there would be dancing: “that our Broad Boulevards, our Beautiful Plazas and Ballroom Floors, our Patios, Clubs and Hostelries shall be the scenes where Radiant Terpsichore and her Sparkling Devotees shall follow with Graceful Tread the Measure of the Dance.” They promised much more, to the extent of a page of flatulent text sprinkled with capitals; but especially they promised “that through our Streets and Avenues shall wind a glorious Pageantry of Sublime Beauty Depicting in Floral Loveliness the Blessing Bestowed upon us by Friendly Sun, Gracious Rain, and Soothing Tropic Wind.”

Presumably the fiesta was successful, with its full quota of Sparkling Devotees and Sublime Beauty. But by New- Year’s Day of 1926 the suspicion was beginning to insinuate itself into the minds of the merrymakers that new buyers of land were no longer so plentiful as they had been in September and October, that a good many of those who held binders were exceedingly anxious to dispose of their stake in the most Richly Blessed Community, and that Friendly Sun and Gracious Rain were not going to be able, unassisted, to complete the payments on lots. The influx of winter visitors had not been quite up to expectations. Perhaps the boom was due for a “healthy breathing-time.”


As a matter of fact, it was due for a good deal more than that. It began obviously to collapse in the spring and summer of 1926. People who held binders and had failed to get rid of them were defaulting right and left on their payments. One man who had sold acreage early in 1925 for twelve dollars an acre, and had cursed himself for his stupidity when it was resold later in the year for seventeen dollars, and then thirty dollars, and finally sixty dollars an acre, was surprised a year or two afterward to find that the entire series of subsequent purchases was in default, that he could not recover the money still due him, and that his only redress was to take his land back again.

There were cases in which the land not only came back to the original owner, but came back burdened with taxes and assessments which amounted to more than the cash he had received for it; and furthermore he found his land blighted with a half-completed development.

Just as it began to be clear that a wholesale deflation was inevitable, two hurricanes showed what a Soothing Tropic Wind could do when it got a running start from the West Indies.

No malevolent Providence bent upon the teaching of humility could have struck with a more precise aim than the second and worst of these Florida hurricanes. It concentrated upon the exact region where the boom had been noisiest and most hysterical—the region about Miami.

Hitting the Gold Coast early in the morning of September 18, 1926, it piled the waters of Biscayne Bay into the lovely Venetian developments, deposited a five-masted steel schooner high in the street at Coral Gables, tossed big steam yachts upon the avenues of Miami, picked up trees, lumber, pipes, tiles, debris, and even small automobiles and sent them crashing into the houses, ripped the roofs off thousands of jerry-built cottages and villas, almost wiped out the town of Moore Haven on Lake Okeechobee, and left behind it some four hundred dead, sixty-three hundred injured, and fifty thousand homeless.

Hurricane damage.

Valiantly the Floridians insisted that the damage was not irreparable; so valiantly, in fact, that the head of the American Red Cross, John Barton Payne, was quoted as charging that the officials of the state had “practically destroyed” the national Red Cross campaign for relief of the homeless. Mayor Romfh of Miami declared that he saw no reason “why this city should not entertain her winter visitors the coming season as comfortably as in past seasons.” But the Soothing Tropic Wind had had its revenge; it had destroyed the remnants of the Florida boom.

By 1927, according to Homer B. Vanderblue, most of the elaborate real-estate offices on Flagler Street in Miami were either closed or practically empty; the Davis Islands project, “bankrupt and unfinished,” had been taken over by a syndicate organized by Stone & Webster; and many Florida cities, including Miami, were having difficulty collecting their taxes. By 1928 Henry S. Villard, writing in The Nation, thus described the approach to Miami by road: “Dead subdivisions line the highway, their pompous names half-obliterated on crumbling stucco gates. Lonely white-way lights stand guard over miles of cement sidewalks, where grass and palmetto take the place of homes that were to be.

. . . Whole sections of outlying subdivisions are composed of unoccupied houses, past which one speeds on broad thoroughfares as if traversing a city in the grip of death.”

In 1928 there were thirty-one bank failures in Florida; in 1929 there were fifty-seven; in both of these years the liabilities of the failed banks reached greater totals than were recorded for any other state in the Union. The Mediterranean fruit-fly added to the gravity of the local economic situation in 1929 by ravaging the citrus crop. Bank clearings for Miami, which had climbed sensationally to over a billion dollars in 1925, marched sadly downhill again:

1925 - $1,066,528,000
1926 - 632,867,000
1927 - 260,039,000
1928 - 143,364,000
1929 - 142,316,000

And those were the very years when elsewhere in the country, prosperity was triumphant! By the middle of 1930, after the general business depression had set in, no less than twenty-six Florida cities had gone into default of principal or interest on their bonds, the heaviest defaults being those of West Palm Beach, Miami, Sanford, and Lake Worth; and even Miami, which had a minor issue of bonds maturing in August, 1930, confessed its inability to redeem them and asked the bondholders for an extension.

The cheerful custom of incorporating real-estate developments as “cities” and financing the construction of all manner of improvements with “tax-free municipal bonds,” as well as the custom on the part of development corporations of issuing real-estate bonds secured by new structures located in the boom territory, were showing weaknesses unimagined by the inspired dreamers of 1925.

Most of the millions piled up in paper profits had melted away, many of the millions sunk in developments had been sunk for good and all, the vast inverted pyramid of credit had toppled to earth, and the lesson of the economic falsity of a scheme of land values based upon grandiose plans, preposterous expectations, and hot air had been taught in a long agony of deflation.

For comfort there were only a few saving facts to cling to. Florida still had her climate, her natural resources. The people of Florida still had energy and determination, and having recovered from their debauch of hope, was learning from the relentless discipline of events.

Despite financial hard times, Florida’s population held strong. She still had her climate.

Not all Northerners who had moved to Florida in the days of plenty had departed in the days of adversity. Far from it: the census of 1930, in fact, gave Florida an increase in population of over 50 per cent since 1920—a larger increase than that of any other state except California—and showed that in the same interval Miami had grown by nearly 400 per cent.

Florida still had a future; there was no doubt of that, sharp as the pains of enforced postponement were. Nor, for that matter, were the people of Florida alone blameworthy for the insanity of 1925. They, perhaps, had done most of the shouting, but the hysteria which had centered in their state had been a national hysteria, enormously increased by the influx of outlanders intent upon making easy money.

The Florida boom, in fact, was only one—and by all odds the most spectacular—of a series of land and building booms during the Post-war Decade, each of which had its marked effect upon the national economy and the national life.

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