South Florida dodged a bullet with Hurricane Dorian. Here’s what that means for the resi market
“I had two sellers ask me for price reductions because it did elevate their stress level,” Riley Smith said
Though Hurricane Dorian didn’t make landfall in South Florida, it heightened concerns for real estate buyers and brokers, who saw the catastrophic damage that it caused in the northern Bahamas.
Brokers in South Florida say the once-Category 5 hurricane won’t have a lasting impact on buyers and sellers’ minds. But the hurricane, which hit the Abaco Islands and Grand Bahama on Labor Day weekend, killing at least 30 people and destroying entire communities, is giving some buyers and sellers pause.
Nelson Gonzalez of Berkshire Hathaway HomeServices EWM Realty said he doesn’t expect out-of-town buyers to become skittish about purchasing property here.
“If it would have hit, absolutely. But the fact that it didn’t hit, it’s business as usual,” Gonzalez said.
Riley Smith, also with Berkshire Hathaway HomeServices EWM, had two buyers wait until the storm passed to put their offers in. One client is now reconsidering options in flood zones, but “nobody is reconsidering Miami.”
“I had two sellers ask me for price reductions because it did elevate their stress level,” Smith said.
But he was also working with a New Yorker who planned to buy a $2 million Miami home prior to the hurricane. That buyer wasn’t concerned with the storm and went into contract on Tuesday.
Smith, who works with 30 buyers at any given time, focuses on Coconut Grove home sales. He said that the biggest impact of the Hurricane Dorian is that everything stopped for over a week.
“I don’t think there will be a lasting negative impact because it didn’t hit,” he said. “We just sat around. It was a loss of time and energy.”
Yet, hurricanes are back on people’s minds, as a result. “We were getting to a point [after Irma] where that was not a memory any more,” Smith added.
Dora Puig, owner and broker of Luxe Living Realty, said “everybody still has that scar” from Hurricane Irma in 2017. But Puig doesn’t believe that Hurricane Dorian’s destruction elsewhere will impact South Florida.
“I think because we didn’t get hit, and because the Bahamas devastation is so bad, that I feel like the focus is not on us,” she said, later adding that, “Everybody is just getting back to work. Thank God.”
In fact, she put a $10 million deal for a Miami Beach condo together over the weekend.
Dina Goldentayer of Douglas Elliman has seen “zero impact” on her business from Hurricane Dorian. Goldentayer has listings for several waterfront properties priced between $16 million and $24 million.
But Goldentayer did say that in general, buyers have more questions about sea level rise, whether a property has impact windows and doors and what its flood elevation is.
“Buyers want homes built to new flood zone standards,” she said.
Compared to a decade ago, buyers are increasingly asking about natural disasters, according to Jill Hertzberg of The Jills Zeder Group at Coldwell Banker.
“Everyone can see clearly what happened to the Bahamas,” Hertzberg said. “By the grace of God that could have been us.”
South Florida’s building codes and resiliency efforts made by cities like Miami Beach make buyers more comfortable closing on properties, Hertzberg said.
In 2017, for example, city of Miami residents voted to pass the $400 million Miami Forever Bond. Nearly half of that is intended to be spent on storm drain upgrades, flood pumps and sea walls. And Miami Beach has installed storm water pumps and raised roads in some areas.
“It is a conversation, and people do ask about it. Everyone understands there’s natural disasters everywhere. The tide rising is going to rise everywhere. The thing we have here in our city because of these disasters is we have really strong new laws,” she said.
Insurers are also still writing policies in South Florida.
“Having good insurance and saving millions of dollars in taxes far outweighs the risk of having a hurricane every 20 or 30 years,” Gonzalez of EWM added.
The slow-moving hurricane, which sat on top of the Bahamas, was predicted to hit the coast in Palm Beach County. Officials ordered mandatory evacuations in some parts of Palm Beach County over the weekend, including the town of Palm Beach. Palm Beach International Airport did not reopen until Wednesday morning.
Jim McCann of Premier Estate Properties in Palm Beach expects the market will bounce back to normal.
McCann, who evacuated with his family for Hurricane Dorian, said it’s too soon to tell if the hurricane will impact the residential market. But he believes that buyers will still look to buy in South Florida.
“Even when storms have hit here and we’ve had landscape damage, the island gets cleaned up pretty quickly,” he said, “and the island goes back to business.”
Ina Cordle contributed reporting.