How Will Real Estate Prices Be Affected by the Recent Wildfires in California?December 20, 2017 6:16 pm Leave your thoughts
Wildfires are scary, destructive, deadly and a financial burden. Even though most wildfire start out small, they spread fast and can be difficult to contain in areas with strong winds and dry grass and brush. What’s more, the dryness and winds provide perfect conditions for wildfires to thrive, while making firefighters’ jobs even harder.
Like we’ve seen in California recently, fires that continue to burn and spread may soon reach towns, residential homes and business buildings, which leads us to a good question: How will real estate prices be affected by the recent wildfires in California? Let’s get some insight from real estate appraisers in Napa County, CA.
The costs of the devastation in California
In October 2017, Napa Valley went through a devastating and deadly fire. People died, hundreds of thousands of acres were destroyed (including wineries and vineyards) and thousands of homes burned down.
Now, in December, Southern California is dealing with multiple wildfires. So far, with Southern California’s largest fire in Santa Barbara and Ventura counties, more than 200,000 people have been evacuated and over 250,000 acres have burned—and the fire is only 50 percent contained. Nearly 100,000 homes are at risk of fire or smoke damage, which will require rebuilding. Experts in real estate estimate the cost to rebuild after the wildfires in Southern California to be over $27 billion, but could likely be higher due to new fires and spreading fires in the area.
The housing market
Massive disasters, like the 2017 California wildfires, may leave hundreds of thousands of people without homes for some time. Many families will choose to rebuild once things calm down, but where do they stay in the meantime? With family or friends? In a rental unit or home? The housing market is already tight in areas where the fires are burning in Southern California—now, couple that fact with the huge number of displaced homeowners and renters looking for new or temporary places to live. Additionally, those seeking to rebuild will want to rent and stay nearby throughout the rebuilding process.
Homebuyers already find the housing market a challenge in many areas of California. Especially now with so many people searching—or planning to search—for housing after the fires, affordable rental homes and apartments are expected to be hard to come by.
Rising real estate prices in Northern California
Another thing to consider is the potential for rising home prices after fire devastation—like what happened in Sonoma and Napa counties after the October fires. The market typically slows down and home prices drop during this time of year, but not in these areas. The fact is, a desirable area will still attract buyers, and those who’ve lost their properties will stay in the area as they rebuild. In Napa and Sonoma, there were not many homes on the market even before the fires. This has led to offers well above market value or asking price coming in for undamaged homes.
Need the help of real estate appraisers in Napa County, CA? Don’t hesitate to call the team at County Appraisals Inc. today for expert assistance.
Categorised in: Real Estate Appraisals
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