The world is ablaze for residents of Northern California. Although the population has experienced large-scale wildfires before—persevering through the Rocky, Jerusalem and Valley fires in the past few years—the immediate danger in Northern California is proving to be a devastating event, leaving whole neighborhoods burned to the ground.
“We are in complete devastation. Fires broke out like crazy. So much of Santa Rosa is gone, just gone,” says Julianna Labra of the Julianna Labra & Edward Buckner team at Keller Williams.
The fast-moving fires that are blasting through multiple counties ignited on last Sunday night and intensified due to heat, low humidity and wind, causing widespread damage of catastrophic proportions. According to the California Department of Forestry and Fire Protection (CAL FIRE), the 21 wildfires have already burned 191,437 acres in Northern California. An estimated 3,500 homes and businesses have been destroyed. (View a daily updated summary from CAL FIRE on burned acreage, damage statistics and containment percentages.)
Wine Country is seeing the worst of it. Sonoma County is getting hit particularly hard by the Nuns, Tubbs, Pocket and 37 Fires, with its largest city, Santa Rosa, reeling from extensive damage. Eleven of the 23 total deaths reported as of Oct. 12 are from Sonoma, where the fires are up to 10 percent contained. The fires in Napa and Sonoma counties have already scorched over 50,000 acres. The scenery is unrecognizable as the once beautiful and sweeping fields of vineyards.
Preventative measures have already been taken to ensure the safety of residents. Gov. Edmund G. Brown Jr. has declared a state of emergency in the following counties: Napa, Sonoma, Yuba, Butte, Lake, Mendocino, Nevada, Orange and Solano. Over 20,000 residents have been forced to evacuate.
Hospitals in the area are receiving a constant flow of patients seeking care for respiratory issues. All Northern California Kaiser Permanente emergency departments, except for one, have remained open during the crisis. Santa Rosa Medical Center was evacuated last Monday—an estimated 130 patients were moved by buses and ambulances. Sutter Santa Rosa Regional Hospital has evacuated patients, as well.
Among those being evacuated are real estate agents, whose businesses will be powerfully impacted by the fires.
“My home is two blocks from a mandatory evacuation area, so, I spent the most threatening night on my roof with a hose watching the fire line crest a nearby ridge. Thankfully, firefighters were able to keep it from moving into inhabited areas,” says broker associate Timothy Brown of Better Homes Realty, located in Santa Rosa.
Other real estate professionals were not as fortunate.
“I live near the Coffey Park area and we were evacuated and still cannot get back home. My family and I—along with so many friends, family and neighbors—were evacuated from our homes around two in the morning [last] Monday. We are staying in Rohnert Park now with family, but so many are displaced,” says Labra.
As of Wednesday evening, firefighters were struggling to contain the volatile fires despite a massive deployment of 8,000 members. State fire officials are dealing with shifting winds that are increasing in speed. However, progress is being made. The Ridge Fire in Lake County has been completely contained, and fire officials are making headway on the remaining 21 fires.
According to a report by CoreLogic, more than 172,000 homes are at risk in the Napa and Santa Rosa counties, which may amount to an estimated $65 billion in combined reconstruction costs. The total reconstruction costs in Northern California are estimated to be around $3.1 trillion, with a total of 9.1 million homes at risk.
The total reconstruction values reflect the cost of completely rebuilding homes from the bottom up. As some homes were merely damaged by the fires, these costs could be lower. (View a breakdown by CoreLogic of costs associated with wildfire risk factors.)
“The speed and intensity of the fires, combined with difficult terrain and heavy smoke, has limited firefighters’ ability to contain the fires; however, the scope and professionalism of the emergency response has been truly awesome,” says California Rep. Jared Huffman. “Some of our first responders are working around the clock even though they have lost their own homes.”
The future of real estate in the affected areas is uncertain. Many homes are now gone, which will create a demand for housing, especially for short-term rentals for those who have been displaced.
“There can be no question that the immediate impact of the fires is an increase in demand and a reduction in housing supply, so our already tight rental and purchase markets will be even more challenging. Next, we will see how the rebuilding process unfolds. Some will put a new house right where the old one was. Others may wind up leaving the area,” says Brown.
“Insurance companies and PRMD will want to expedite reconstruction, but there will be a shortage of contractors to do the work,” he added.
Some of the affected areas were dealing with slow markets before the fires broke out.
“With Sonoma County already lacking enough inventory prior to the fires, I suspect this will really put housing on extra high demand. Prices may climb in the near future but of course we have no crystal ball to predict how things will play out in the real estate world here in Santa Rosa and the surrounding areas that were affected,” says Labra.
And what of clients who were in the process of buying and selling when the fires ignited? Many seller clients will have to wait for insurance claims to decide their next steps, and buyers may decide to purchase in other areas, or may postpone their search completely.
“I have listings in Wikiup, Calistoga and near the evacuated Rio Linda Academy in Healdsburg that are all in jeopardy. Because of the road closures we do not currently know if the structures have been damaged or not,” says Brown.
For other agents, transactions may resume as normal if their clients’ homes are largely intact.
“Thankfully none of my current listings or homes in escrow were damaged, but just [two weeks ago] I visited a wonderful family in the Coffey Park neighborhood and made arrangements to start the selling process of their home. Now that home is gone,” says Labra.
State representatives are promoting community collaboration and support as the best way to deal with the destructive fires.
“I am heartened by the neighbors and community partners who are pitching in to support each other with housing, food, medical supplies and other donations,” says Huffman. “We’ll need this sustained community response in the coming days when we transition to rebuilding and recovery.”
Real estate companies are jumping into action to help with the crisis, as well.
“Shelter is one of the most basic human needs and people in this business are more familiar with the stress of homelessness than anyone. When disasters happen, we use our network of resources to help people deal with floods, earthquakes and fires,” says Brown.
“I have been able to help homeowners find the status of their properties in affected areas and when the news is bad, help them find temporary housing. The Association of REALTORS® is already putting together plans to help victims of the fires,” he added.
Other real estate professionals have switched gears, using inventory in a creative way to help fellow community members who have been displaced.
“The local REALTORS® are jumping in to help in any way we can. A Facebook page I run is going to be compiling a list of people who have currently vacant listings available for families in need,” says Labra. “We will also be getting creative and finding new ways to help as we go along.”
Stay tuned to RISMedia for more developments.
Liz Dominguez is RISMedia’s associate content editor. Email her your real estate news ideas at firstname.lastname@example.org.
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