The contract was written for the sale of a Gulf-front Longboat Key property. Tina Rudek, of Engel & Völkers Longboat Key, was representing the buyer for the transaction, and the seller was waiting on the deposit.
Then, news broke that the amount of oil seeping into the Gulf from the BP Deepwater Horizon oil spill was double the amount previously projected. Rudek didn’t hear back from the buyer for three days. When he finally did call, he was honest with her.
“He said, ‘I have to consider this because I have another Gulf-front property,’” Rudek said. “People are scared.”
Eventually, the buyer did decide to buy the property. However, had he walked away from the transaction, Rudek said, she would have considered hiring an attorney to file a claim against BP. Rudek said that a couple from Germany also recently decided to hold off on buying a Longboat condo because they had heard there was oil in Florida.
“A lot of people have no clue how big Florida is and how much water there really is in the Gulf,” she said.
According to a recent Bloomberg News report, the oil spill could reduce Gulf Coast property values by 10% over the next three years. Although the study only focused on land from Louisiana to Clearwater, the impact could extend south if oil were to wash up on area beaches.
The good news is oil from the disaster is at least 150 miles away from the Sarasota-Manatee area. Even better news: It’s likely to stay that way (see sidebar). But local Realtors say that buyers have become hesitant and are, increasingly, waiting until the outcome of the disaster is clear.
Judy Kepecz-Hayes, of Coldwell Banker Residential Real Estate, said that three buyers have told her that they are putting their purchases on hold until they can be sure that oil won’t hit local beaches.
“I told them that the chances are slim, but it’s hard to give reassurance on something like that,” she said.
Marnie Matarese, of Re/Max Excellence, said that she was scheduled to show properties over the Fourth of July weekend to three different buyers who canceled their scheduled visits because of oil-spill concerns. Another client who bought a beachfront Longboat condominium earlier this year called Matarese to ask if he should put his home on the market to get out “before the oil hits.”
“This is very serious because the public’s perception is so wrong,” Matarese said.
Cheryl Loeffler, of Signature Sotheby’s International Realty, said that she has had two Longboat Key buyers change their minds about purchases because of the oil spill. One decided to hold off for now, and a second dropped his contract to a letter of intent with a contingency that he wouldn’t be interested in the property should oil hit. Loeffler said that several sellers who accepted offers at the lower end of their homes’ value have recently called her expressing relief that they accepted those prices.
To address clients’ fears, Realtors and business leaders are taking a proactive approach. Last month, local business leaders, including Realtors, gathered on Lido Key’s beach to shoot a You Tube video promoting the area and reminding people that local beaches haven’t been impacted by the spill. Since then, the video has gotten more than 4,000 hits.
Kepecz-Hayes and Matarese say that they’re frequently e-mailing clients to keep them abreast of the situation. Next month, when Rudek attends a real-estate conference in Spain, she plans to spread the word that oil is unlikely to strike the Sarasota area. According to Rudek, it’s an important message to get out to Europeans, many of whom have heard through media reports that oil is washing up on Florida beaches.
And for buyers who are still hesitant to buy because of the spill? Realtors say that contingencies, such as the one that Loeffler’s buyer put in his letter of intent, are a way to minimize the risk.
“There’s no way of prognosticating what’s going to happen,” Loeffler said. “It’s still a beautiful place, all of the wonderful aspects of living here are still in force. It’s kind of like a red-tide event. You can’t do anything about it. You just have to deal with it.”
Matarese said that the area may lose out on some people who want to buy now and are likely to look elsewhere. But others want to buy here and are likely to return if it becomes clear that oil isn’t headed for the area.
“For a very large number of people, Florida is where they want to be, and they’ll come back here,” Matarese said.
BRACING FOR IMPACT
Speaking at the Longboat Key, Lido Key, St. Armands Key Chamber of Commerce Small Business Week Awards Breakfast Thursday, June 17, Laird Wreford, Sarasota County coastal resources manager, brought a piece of good news.
Because of prevailing winds, the Continental Shelf and the Loop Current, oil is unlikely to head toward Sarasota. In the unlikely event that it would reach our shores, a significant amount of time would have elapsed and oil would be breaking down. Smaller tar balls and mats, rather than large oil plumes, would be most likely to wash up on local beaches.
But, according to Wreford, the oil spill has had an impact on the area because of perceptions that the media has helped create.
“Viewers are led to believe that our shores are covered by balls of slimy oil,” he said. “We have already taken an economic hit.”