Hurricanes Harvey and Irma left devastation in their wake in areas of Florida and Texas. Residents are struggling to adapt after weeks of cleanup to remove debris from the streets. Roads are heavily damaged from flooding and homes are destroyed. What does this say for the real estate market in these areas?
“We need to keep our friends and neighbors in Houston and Florida in our prayers and thoughts,” said Ron Peltier, chairman and CEO of HomeServices of America, at RISMedia’s 2017 Real Estate CEO Exchange earlier this month. “Just in our business alone, a lot of transactions will fall out; there will be a lot of lost revenue for agents and brokers. I don’t think it will right itself any time soon.”
Houston was hit particularly hard. Mark Woodroof, partner at Better Homes and Gardens Real Estate Gary Greene Realtors®, described the cleanup logistics in Texas as overwhelming. Houses are flooded, and furniture and drywall insulation are out on the curb waiting to be picked up.
While brokerages offered support for agents affected by the storms, it will be a long road to recovery. Sixty-two agents from Woodroof’s office alone were impacted.
“We had eight of our own team members severely affected, yet our whole firm, community, business leaders, friends and family came together to assist in rebuilding,” says Nimesh Patel, owner and managing partner of RE/MAX Fine Properties in Sugar Land, Texas. “As for future business, we are very confident in our agents and our community; we will be on our feet and on top very soon.”
Immediately following the storm, the majority of Florida dealt with downed trees and roof leaks. The Florida Keys took the brunt of the damage, while inland regions are already recuperating. Rei Mesa, president and CEO of Berkshire Hathaway HomeServices Florida Realty, has 40 offices throughout Florida, all of which are up and running at normal capacity. Other than scheduling delays due to evacuations and dangerous weather conditions, transactions are mainly on track to close, if they haven’t already.
“Florida is resilient,” says Mesa. “There were delays due to repairs, re-appraisals and re-inspections, but we’ve become very good at forecasting the impact [of hurricanes].”
Texas business continued on, as well. Woodroof’s offices closed on over 500 homes in September despite flooding caused by Harvey.
Other Florida brokerages relied on the Force Majeure and Risk of Loss sections of their standard contract to protect both sellers and buyers during their transactions.
“Our mortgage and title teams were essential in communicating about the federally mandated re-inspection guidelines and working with vendors to schedule them as soon as possible,” says Drayton Saunders, president of Sarasota, Fla.-based Michael Saunders & Company.
Contract protection and homeowner’s insurance may not be enough, however, for sellers that did not have any or a sufficient amount of flood insurance. Many are looking to FEMA for financial aid. Over 200,000 applications in Texas and Florida have already been approved for individual assistance.
While the impact of these storms may discourage some individuals from moving into hurricane-prone areas, Saunders predicts a bigger focus …read more
From:: Finance and Economy