That’s a good question, and I guess the answer depends on which facts you believe.  In the beginning we were told the spill was leaking about 1,000 barrels per day, and just this past week we’ve been told it is now 35,000- 60,000 barrels per day, which translates into 1.5 million gallons to 2.5 million gallons per day.  The truth is BP hasn’t been very concerned with educating us on the true facts nor the scope of the problem in the Gulf. 

I’ve been watching a lot of TV on the issue and reading articles and it appears that many experts believe SW Florida is located in what they call a “Dead Zone, or Forbidden Zone”.  This is a confusing term because they also call the panhandle a dead zone because of the impact of oil and its effect on wildlife caught up in the oil.  The “Forbidden Zone” they refer to in SW Florida has to do with currents, and the fact many experts believe SW Florida will be protected by these currents from the oil. 

NOAA Real-Time Forecast Map for Gulf of Mexico
Gulf of Mexico Loop Current and Forecast Map

In fact, Dr. Jeff Masters who created Weather Underground wrote a blog article on how SW Florida is protected.  He writes “the west coast of Florida from Tampa Bay southwards to the Everglades is at minimal risk of receiving oil from surface currents.  It appears the ocean side of Key West as well as the East coast of Florida is at more risk than SW Florida due to the currents and land configuration. 

So is SW Florida completely safe from oil?  That answer is probably not.  There is still a risk of a hurricane or tropical storm blowing oil into SW Florida, although not likely.  Most likely a tropical system would help blow oil away from SW Florida.  Dr Masters also writes that the protection in the “Forbidden Zone” only holds true for surface oil, and if in fact there are underwater plumes, this oil could get caught up in the Loop Current and could make its way anywhere really.  Again, more likely would be the sensitive areas of the Keys and up the East coast. 

The larger risk to SW Florida is the “Perception” that oil has hit, and this affects tourism and the economy.  News reports indicate hotel bookings are down across the state as many people believe oil has hit, or will hit very soon and they’re afraid to book travel.  The Reality is oil has not hit anywhere close to SW Florida, and likely will not anytime soon, if ever.  Of course, misleading facts from BP and the government do little to soothe people’s fears, so their perception becomes their reality. 

The reality is oil may not ever come here.  The reality is oil has already hit other places, and likely will hit more places.  Once word reaches out that SW Florida has been unaffected, other places loss could become our gain. My gut tells me nobody wins though, as tourists tend to shut off and believe the entire state is under siege.  It’s possible in the future tourists will want to go where there was no oil, and that could become a future selling point for SW Florida down the road. 

In the meantime, I think we just need to keep the word out that the oil is not here, is not close to here, and our beaches are safe and a fun place to vacation.  SW Florida remains home to fantastic fishing, awesome beaches, excellent real estate values and a high quality of life. 


Likely Areas of Impact

Latest Ocean Current Forecast

NOAA Interactive Mapping Tool of Spill One of My Favorites

The Gulf of Mexico Loop Current: A Primer

What Oil Might Do to a Hurricane

Last week we reported showings and phone calls were down for a few weeks after Easter according to several agents we spoke with, but that all changed about a day after writing the story.  Phone calls and offers picked up significantly last weekend, so it’s very hard to judge the market on a daily basis.                   

This week we decided to step back and analyze April 2010 vs March 2010.  Official numbers won’t be released until next week, however we believe we’ll see a year over year increase in home sales about 9-10%, and we believe prices will up again over last year as well. 

SW Florida Real Estate Home Sales Lee County Florida
Single Family Home Sales in SW Florida March-April 2010

We’ve created a graph illustrating sales numbers for March-April of 2010.  Sales for single family homes increased ever so slightly over March.  We then wanted to know the mix of foreclosed homes and short sales.  Foreclosure sales actually fell 10.43%, while short sales rose 12.96%.  This coincides with our predictions back in March that we may see a rise in short sales as bank gear up to handle more short sales. 

Foreclosure filings have been down, so 6 to 12 months in the future it’s reasonable to assume there may be less foreclosure properties for sale, especially if banks continue to increase their short sale efforts. 

Our numbers are close to but not identical to official numbers that will be released next week for one reason.  We use data from multiple MLS’, but there is the potential for some listing overlap if a property is listed in more than one MLS.  Statistically that runs about 5% give or take.  We’d rather have a little overlap than miss a lot of listings and sales. 

Condo sales were up in April over March, and that would be expected as condo sales tend to build throughout the season and culminate in April.  Condo sales are increasingly difficult to finance with new regulations on approving not only the borrower, but also the association itself.  Many March closings were pushed back to April, and we suspect many April closings may get pushed back to May, so May could be a good month due to high sales and delayed closings, both in the condo and single family markets. 

Headlines next week should read home sales up somewhere around 10% +/- depending on what the official figures are, and home prices up as well.  Last year’s April median home price dipped to $85,500.  March 2010 median figures shot up to $95,100 up from $88,000, so even if prices hold steady from March we should be reading about price increases. 

Next weekend is Memorial Day weekend, so sales activity will drop-off as people plan their time off.  It will be interesting to note people’s perceptions of Florida and their willingness to book vacations here in advance due to the oil crisis in the Gulf.  Many visitors come back in the summer and buy.  Additionally, the Euro is now worth less, so it will be interesting to see if that affects foreign visitors this summer with less buying power.  Hopefully once we sort out the Gulf oil spill, our Chambers of Commerce will promote the area as a great place to visit.  We count on many of these visitors to buy property in Florida each year, so we do want them to visit and spend money in Florida and help our economy. 

In the meantime, let’s enjoy some positive publicity next week.  Our market is due for positive news, and it helps buyers to understand that prices are rising and inventory is shrinking little by little, and the time is now to step up if they want in on today’s bargains.