The Oil Spillover Effect

There are three critical issues connected to the oil spill that could seriously impact Florida real estate. The first is one of perception. Typically bad things are worsened by beliefs that things are worse than they actually are. It often translates into postponed decision making and or discounting that reflects consumer concerns. The second area is that things are really as bad as the news that is generated. Florida’s appeal has always been heavily focused on the appeal of its beaches and waterways. Vacationing in Florida has always been a generator of retirement, second home and investment demand for residential product in addition to the dollars that tourism generates for the Florida economy. We are already experiencing the pain of the housing bubble and a bad recession so things are quite fragile without another man made disaster. Some areas in Florida might benefit from another area’s problems but overall any area directly impacted by this oil spill could see recovery curtailed for several seasons or worse. The most critical thing will be to establish some realistic measurements as soon as possible. People deal better with things that they understand. It may be bad news but like the monsters that we conjured up in our minds when we were kids, they were often a lot scarier than the author or movie director gave us.