Banner Image above: Wildfire damage. Photo by Eric Thayer/Getty Images.
Wildfires destroyed a row of homes. Photo by Sandy Huffaker/Getty Images

From The Ground Up
In October’s firestorm, approximately of 1,400 homes were destroyed, and these homeowners were left overwhelmed. They are now in the position of having to decide if, when, and how to rebuild.

"First of all, people who lost their homes, who lost everything in the fire, need time," says Catherine Barry of Barry Estates. "We’re advising them to lease and not rush into making any quick decisions, such as buying another property. They need time to get their lives together."

The first step in the process of rebuilding or selling the lot is working with insurance companies. Make sure the insurance adjuster walks the site to see the full effect of the fire. "If the house was burned to the slab, even if the homeowners want an exact replica of the previous home, the old slab will have to be broken down and hauled away," says Monty McCullough of McCullough-Ames Development. This also applies to fire-damaged driveways, which may be too brittle for the heavy equipment needed to rebuild. "The city is developing a way to mass-clear the debris from these fires at no cost to the homeowner, to get rid of all the soot, ash, and pollution left in the fires’ wake. This is a good thing," says McCullough. "But are they going to break down the slab and driveway and haul them away?"

When it comes to renting or leasing while a home is being rebuilt, insurers need to be clear on the time and rental rates covered in their policies. Says Barry, "People don’t want to disrupt their lives and their lifestyles any more than they have been by these fires. This means people are interested in renting in areas they lived in before, which could mean high rents for relatively long periods of time, depending on the rebuilding process. Therefore, you need to be informed about the amount of money you’ll be reimbursed for rent."

The good news is that insurance companies have been extremely responsive to their clients. John Lefferdink of Prudential California Realty of Rancho Santa Fe says he knows of someone in the Covenant who received an insurance check within two weeks of the fires.

In the short term, the housing market, especially rentals and leases, have been stimulated. The 1,400 or so homeowners and those people who had extensive fire damage to their homes that make them unlivable are all potential renters. "We’ve seen houses that were on the market for a long time get taken off and used as rentals," says Lefferdink. "This makes it a win-win for the seller and the person now renting the house in the area he wants to live while his house is getting rebuilt."

"Rebuilding can take as long as two years," says Robert Weir of Weir Brothers Construction. "This is dependent on the insurance company, clearing the debris from the house and slab, finding a builder/developer, drawing up plans, getting building permits, etcetera."

It’s true that because of the recession and the slowdown in new home construction before the fire, activities, such as getting building permits, were taking longer. The San Marcos planning department has closed down, and the county staff for building and planning has been cut in half.

"The county situation shouldn’t affect the people who are rebuilding after these fires because the city has stepped up, like they did after the Cedar Fire," says McCullough. "During the Cedar Fire, the city set up a satellite at a facility in Scripps Ranch. They are going to do the same in Rancho Bernardo."

In response to the 18 or so homes lost in the Rancho Santa Fe area, Robert Green, the building commissioner for the RSF Association, and the Art Jury have developed an expedited process for homeowners who want to rebuild. For example, if Rancho Santa Fe homeowners are rebuilding using the exact plans of the previous house, there is only one application. This eliminates two of the three steps. If homeowners are rebuilding using a different design, then one of the steps has been eliminated. The Rancho Santa Fe Association is waiving application fees and reducing building permit fees.

"In addition to these amendments to the process, we are moving those homeowners who were affected by the fire to the front of the line," says Green. "It’s important to stress that we do want the process to be accelerated, however we also want to ensure that the Covenant is still maintained."

How does a homeowner find a dependable builder? Weir says that many of their former clients have returned to them. "If you had a good relationship with your homeowners when you built before, this usually means they’ll come back whether it be for remodeling or in this case rebuilding. It’s important to develop and maintain these relationships."

"San Diego is a small community. People know who the good, trustworthy builders are," says McCullough.

Jeff Smith of Smith Brothers Construction has been in business for 30 years. "We’re interested in helping those who have lost their homes in the fires," says Smith. This isn’t the first time Smith Brothers has given back. Throughout the years, in partnership with community associations, they have contributed their resources, talent, and time to build and support the San Diego community. This includes building homes for Habitat for Humanity. In response to the fires, Smith Brothers Construction and a handful of architects have partnered together to offer discounted architecture services to people who are rebuilding. "We are not interested in profiting off of people’s losses. We want to help them by hand-carrying permits through the city’s process and rebuilding in an efficient way without comprising integrity."

Rebuilding a home can be an opportunity to build people’s dream homes and homes that will increase in value over time. Many of the houses that were destroyed in the fire were built in the ’70s and ’80s. As homeowners decide to rebuild these homes, developers encourage clients to consider building houses that will have higher resale value. Homes built 25 to 30 years ago had living rooms and formal dining rooms, small bedrooms, and small kitchens, which are no longer in vogue. "We’re advising clients to consider one-story, smaller homes with a breakfast nook instead of formal dining room, larger kitchens, and big family rooms and game rooms instead of living rooms," says McCullough. Indeed many baby boomers like the idea of more manageable single-story homes of significantly less square footage.

Considerations for building and preventing home losses and damage include clearing brush to at least 100 feet from houses (a California law) and implementing the shelter-in-place program, which includes mandatory indoor sprinklers, noncombustible roofs, wide roads and driveways for firefighting equipment, and 100 feet of defensible space with irrigated, fire-resistant plants. Weir regards the clearing of brush and noncombustible roofs as critical components in a good loss-prevention plan.

What is the long-term and short-term real estate market going to be like? Steve Rodgers, president and CEO of Prudential California Realty claims there were some major hiccups in the first weeks after the fires. "Everything was put on hold, because lenders and insurance companies had to get out to those homes that were in escrow to see if they’d survived the fire," says Rodgers. "Lenders were concerned that these homes be properly insured for loss."

Based on the events following the Cedar Fire, the economy will be stimulated by new jobs in the construction industry as a result of October’s fire losses. "In the long run, I imagine we’ll see people buying homes in the next six months to a year. Those people who have decided not to rebuild will be looking for homes to buy," says Rodgers. "After disasters people have the mentality that life is too short and it may be time to set down roots." It doesn’t hurt that there is an election year coming up, and interest rates have already been lowered.

"From what I can see, the people who lost their homes are really turning lemons into lemonade," says Barry.

Rodgers puts it this way. "Not long ago, I went to dinner at a friend’s house who’d lost his house in the Cedar Fire. We were standing in front of his large picture window of his newly rebuilt house. He said, 'This is the view and the window I always wanted. Who would have thought that four years after losing my home that I’d be looking at it as a blessing? I have the house that I love." — Michelle Zive