Disaster Real Estate

Chris dives into the aftermath of natural disasters in Florida and California, explaining why many homeowners are choosing not to rebuild in high-risk areas like the Pacific Palisades and Florida's barrier islands. With soaring costs, stricter building codes, and dwindling insurance options, the real estate landscape in these regions is transforming. www.watchdogonwallstreet.com

Episode Transcript

Speaker 1 (00:00):
The Watchdog on Wall Street podcast explaining the news coming
out of the complex worlds of finance, economics, and politics
and the impact that we'll have on everyday Americans. Author,
investment banker, consumer advocate, analyst, and trader Chris Markowski.

Speaker 2 (00:16):
Disaster real Estate got a lot of questions. Uh, it's
going back the past several months, going back to the
hurricanes here in Florida, now it's going on in California,
asking my opinion on what's going to take place after
these disasters in these areas. Can we we cover real

(00:36):
estate heavily here on program, we're real estate real ESTs.
You well know my I go after I go after
the real estate industry, well, the you know, the real
estate agent business quite a bit here on the program. Man,
there's some good ones out there. But again, you know,

(01:00):
is there ever a man time to my real estate? No,
it always goes that's you know, they're not fiduciaries by
any stretch of the imagination. Anyway, I found this interesting
and exactly what we called and expected here. Big real
estate agent out in California say that about fifty percent

(01:20):
the people who lost their homes in the Palisades are
not coming back most of them were just uninsured, uninshort.
They said that people just can't, you know, afford to
rebuild those homes. Again, that area is not going to

(01:43):
be the same. The same thing holds true. And this
is kind of a different take. Southwest Florida, many different
areas got hit with the two hurricanes that happened this
past year. There were some areas, in particular csta Key,
Anna Marie Island where you had some very very wealthy homes,

(02:09):
not not to the extent you're not talking the Palisades
type homes, but but again also in Davis Island in
Tampa that were destroyed, some of them insured, some of
them not insured, whatever it may be. Those are a
little bit different story when it comes to the ability
to rebuild. We've already seeing businesses in certain areas. He's

(02:32):
wealth there. Sarasota, Florida in particular, certain ones are saying, no,
we're not coming back here. The city hasn't done the
proper infrastructure. We're tired of it being flooded on and
on and on. Other areas in particular further South talked
about this poor and again, I know this area well
because I used to go there as a kid, and

(02:54):
my mom still happens to live there. It's down in Mannesota,
Key and Wood area and some of these other areas
there where this, you know, is a barrier island, beautiful
near the beach. But it helped happen to have a
lot of older homes living in close proximity to the water.

(03:16):
Many of these homes were uninsured. You have a lot
of elder had a lot of elderly residents in these
places that area. You know quite frankly that they're not
going to be able to afford to rebuilt. It's not
going to do it. The building standards as far as
construction is concerned here in the state of Flora, it's expensive.
They're not going to be able to afford it. And

(03:37):
what you'll probably see in that area is you'll probably
see larger lots combining various different lots, and larger very
expensive homes built to code to withstand all of these hurricanes.
Because again, if you have a house that would stand hurricanes,
it's built properly. The technology here today, Yeah, you're going
to deal with some damage, but it's not going to

(03:58):
take your house down. As far as fire is concerned,
it's a different situation. I do think that many people
you know that have these these mansions there Pacific palisades,
are they're not going to go back and do that again.
It's not going to look the same by any stretch

(04:20):
of the imagination. You know, it was difficult to ensure.
We had our insurance companies pulling out. Are you going
to do that again? You're going to make a an
in quote unquote investment and a home a you know,
an asset like a house that you cannot ensure again.

(04:44):
I get it if you can afford it, okay, if
it's a situation where it doesn't matter to you, you
have that type of money, doesn't matter, okay. But I
think the summer going to say, you whiz, I just
lost a thirty million do dollar home. I just lost
a thirty million dollar home. I got to rebuild a

(05:05):
thirty million dollar home that I'm not going to be
able to ensure, knowing that it can happen again. I
get you live in an area that's always been prone
to fires. Listen, the state has its rules when it
comes to insurance. You can't ensure that asset. I mean,
you think about it. You would ensure jewelry, but you

(05:29):
can't ensure that, I mean, and your jewelry is probably
keeping it safe. It's less likely to be stolen than
a fire ripping through. So yes, the entire dynamic is
most certainly going to change. Within these areas, it won't
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