Zika’s Effect on Florida Real Estate and the Economy
- Sep 30, 2016
No word sends a shiver down the spine of a Floridian than ‘Zika.’ A Mosquito-borne illness that causes brain damage in newborns and dengue flu-like symptoms in adults. Florida’s economy relies heavily on tourists’ and investors’ dollars, but they have been shying away from South Florida, which is causing a collective headache for business owners. The warm weather is what attracts tourists, but also the mosquitoes that have migrated from Latin America that are carrying the Zika virus. Florida Governor Rick Scott says there is ongoing efforts to reduce the spread, however the damage has already been done to the economy by shaking confidence with the new reality of “Is it safe to go outside today?” Small businesses that rely on foot traffic, especially those in the affluent Wynwood neighborhood in downtown Miami are hurting the most. The hip neighborhood was hit the hardest and was declared the first ‘Zika transmission zone’ in America. Zika fears are also reshaping Southeast Florida’s real estate market, with agents poaching prospective buyers away from the affected popular neighborhoods by claiming the location of their listings are safer for families.
What is Zika?
The Zika virus is related to dengue, yellow fever and West Nile with similar symptoms such as headache and fever. Its biggest affect is on pregnant women by causing microcephaly, which causes birth defects and brain malformations. The disease has been around since 1947, having originated in Uganda and spreading across tropical and subtropical regions near the equator. So far the worst affected region is Rio de Janeiro, Brazil, which stoked fears of travel to the city for the 2016 Summer Olympics last month. The World Health Organization (WHO) have identified the disease as a global health crisis with cases continue to mount every day with no vaccine or cure yet to be introduced. In fact, the current global pandemic began in 2007.
Gov. Scott has been steadfast in quelling the spread across the state by eliminating standing water where mosquitoes lay their eggs and promoting the use of mosquito repellent. Zika has been in the state for just over six weeks when the first case was reported in Wynwood on July 29, the governor then instituted a one-square mile containment zone and a federal travel advisory was introduced by the Center for Disease Control and Prevention (CDC), which was the first of its kind in American history. The advisory in Wynwood is not expected to be lifted until Sept. 19. The virus was also detected in tourist-frequented South Beach on Aug. 18 and experts believe it affects a 1.5 square-mile radius.
Southeast Florida relies on the tourism industry to trickle revenue down to small businesses and everything in between, but the upcoming winter is expected to be abysmal for the local economy. This is because many young couples and expecting mothers will opt to go on vacation elsewhere because of the large scale media attention on Zika this past summer. However, those that have already made bookings are expected to still make the trip.
The economy has taken a huge hit with little sign of hope of a quick solution, according to Joseph Furst, chairman of the Wynwood Business Improvement District.
“I wish the messaging was focused more on how to get better testing to people and how get the entire community better informed as opposed to labeling boxes around our cities and counties,” Furst said in response to the travel advisory. “If I had an opportunity to speak to the governor, I would urge him to lift the box from the Wynwood, Midtown, Design District area.”
However, there has been several reported cases in the area, which makes it critical that it be contained.
The mid-August Zika outbreak in a 1.5-square-mile zone in Miami Beach, which encompasses Lincoln Road, Ocean Drive and Collins Avenue is an epicenter for tourist activity. Business owners fear their hotels, restaurants and shops will struggle immensely as a result and are looking to the state government for aid.
“Tourism is a driving force of our economy,” Gov. Scott said during in an August press conference. “And this industry has the full support of the state in this fight against this Zika virus.”
Gov. Scott assured the public after the press conference that the Department of Economic Opportunity would offer funds to help recoup losses incurred from the drop in tourism. Some like Faust, who’s employer Goldman Properties experienced a 40 to 50 per cent decline, are not feeling assured.
Despite criticism, the travel advisory and Gov. Scott’s Zika transmission zones have helped to curb the rate of infection. They are also the only viable solution since there is no vaccine/cure and the coming winter will not rid the virus in the area. This is because the mosquitoes pass the virus on to the next generation because their eggs will easily survive the mild winter and hatch next spring. One positive for the rest of the country is that the Aedes aegypti, the type of mosquito that carries the Zika virus, is only found in the tropical and subtropical areas. Therefore, the spread is limited to the states along the Gulf of Mexico.
The spraying of standing water with a larvae-killing bacteria is the best solution, while also promoting the use of bug repellent. However, they are difficult to find, which leaves the State with little option other than to use time-tested solutions.