For Michael Nourmand, president of Nourmand and Associates REALTORS®, and Martha Mosier, president of Berkshire Hathaway HomeServices California Properties, there's no masking the enormity of what lies ahead. While consumed with the present and finding living spaces for people, they are both steadfast in the belief that there will be a new, albeit different, land of opportunity to come.
The fires didn't quite hit home, literally, for Nourmand, but they are close enough that he moved his family to a hotel to avoid the smoke and acrid air. "It's like an apocalypse," he says about the continuing blazes that have turned lovely neighborhoods to scorched earth. "You can see the smoke all over the city, and when I got up in the morning, there was ash all over my car."
Nourmand explains that there is naturally a surge in leasing prices for properties nearby, with thousands of people having lost their homes, but it's extremely difficult to find something, even with the help of an agent.
"There is an anti-gouging thing in place to prevent landlords from taking advantage of desperate tenants," he says. "It is almost impossible for those of us trying to help, and that's with zero regard for getting paid, zero written agreement, zero paperwork, nothing. This is just to try and send people places. You almost have to know a landlord, or the agent has to have a relationship with the landlord."
Nourmand's agents are still busy helping buyer clients, but obviously in different neighborhoods for many, he says. And insurance availability issues are now front and center.
"Pacific Palisades obviously is very damaged, but people are looking to buy in Brentwood, Santa Monica, Westwood and Beverly Hills. The question's going to become, can people get insurance? Right now l'm hearing conflicting things. I have to make some calls. One agent said there's a moratorium, but another one said that's not true."
On January 7, the California Insurance Commissioner issued a "mandatory moratorium on cancellations and non-renewals of policies of residential property insurance" applying to 35 zip codes that were affected by two separate fires, with a note that more zip codes could be added in the future.
Nourmand admits there will likely be price hikes on homes for sale because of the sudden inventory issues. "I think that there will be some price appreciation just because of basic supply and demand," he says."I think it's going to be like when they had fires in Malibu, and the Malibu market was depressed for some time...(t)he neighboring areas are going to have more demand and upward pressure on prices."
Nourmand noted that agents in Southern California will need to sharpen their expertise on insurance going forward.
"As an agent, you have to be a generalist and have some understanding of all the different aspects of the (homebuying)-process," he said. "Insurance prices have gone up a lot, so that was already somewhat of a requirement over the past four or five years.
"There's a disclosure now for getting insurance. It's a contingency, which it wasn't specifically called before. But yes, I definitely think that as attentive and knowledgeable as we have to be about insurance, we'll have to be even more now, and we'll also just have to have better insurance brokers we work with who we can give an address and have them say, 'Okay, here's who I think will do the insurance, and here's roughly what I think the cost will be.' So that way buyers can factor it in before they write an offer, or at a minimum, early on in the escrow period."
