If history counts, the Jekyll Island Club and the entire coast of Georgia is not likely to be hit by a major hurricane anytime soon.

 

        The most oft-asked question by my customers contemplating a home on the eastern coast is not about the financial health of developers, or temperatures in summer and winter, or even if a golf community course is in good shape.  The most asked question is, “What about hurricanes?”

        As the owner of a second home ¾ of a mile from the Atlantic Ocean, I have voted my point of view.  I think the fear factor is overrated, an outgrowth largely of the devastation we all witnessed on television in the wake of Katrina. But it is clearly on the minds of many who would live a nine-iron from the beach if it weren’t for the perceived threat of Category 4 or 5 storms.

        Getting over hurricane anxiety this year will not be any easier, not with a respected hurricane forecast group

indicating the Atlantic coast is in for a rough season.  According to an article today in the Hartford Courant, the Hurricane Forecast Team at Colorado State University predicts four major Atlantic hurricanes in 2010.  Major hurricanes are those with winds exceeding 111 mph.  In all, the Team forecasts 15 "named" Atlantic storms of note later this year.  A typical year yields an average 9.6 such storms and 2.3 major hurricanes.

        We have been down this path before, years in which forecasters predicted the worst and we wound up with something much less.  Of course, during the years of Hugo and Katrina, no one quite forecast the strength and devastating path of those devils.  But last year, for example, seemed more typical, when the Colorado State team predicted six hurricanes, and the final tally was just three.

        So how big a threat are hurricanes along the eastern seaboard?  And are any areas statistically safer than others?

        To try to answer the question, I found a map at the U.S. government’s “severe weather” site that charts the landfall locations for all hurricanes from 1950 to 2004.  It does not include Katrina and other storms since 2004.  If you were to use the map as guidance on where to buy a golf community home, you could easily make the following observations: 

        1) The entire Georgia coast is safe; it has not been struck by a hurricane in 54 years;

        2) Charleston, SC and the Outer Banks of NC have the greatest chance of Category 3 & 4 hurricanes, which pack winds between 111 mph and 155 mph; 

        3) The chances of avoiding a hurricane altogether are better on the east coast than along the Gulf of Mexico, where an uninterrupted line of landfalls extends from the panhandle of Florida to Houston, TX; and

        4) The safest locations on the eastern seaboard are along the coasts of Virginia and the Delmarva Peninsula, and for a stretch of Florida roughly between Daytona and St. Augustine.  Check out the map for yourself by clicking here.

        Inland locations in the Carolinas won’t ever have to suffer through storm surges, but that doesn’t mean they are immune to flooding and, in higher elevations, mudslides.  Not all hurricanes strike a glancing blow on the coast; many proceed inland, diminished but still capable of costly damage.  Check out these state-by-state maps that show the paths of hurricanes from 1851 to 2005.

        The issue of buying a home near the coast really comes down to potential economic damage, not personal safety.  Meteorology has become so sophisticated, the Colorado State team notwithstanding, and the Weather Channel is so ubiquitous that no one need fear a storm sneaking up on them.  You always have at least a few days to evacuate, and states with a coastal presence have become adept at organizing roadways for swift and substantially uneventful evacuation.  Some people worry, justifiably, about whether they will have a home to come home to in the wake of a major storm, and whether their insurance premiums will affect their financial security.  These are real concerns but, perhaps, not enough to tilt a decision away from a place where you really want to live.  As the data shows, there are ways to severely limit the risks.

        Data and history tell us that the chances of a devastating storm along certain stretches of the eastern seaboard are remote.  For those who love the sand and the surf, the minimal risk is worth the rewards.

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Map of hurricane landfalls from 1950 to 2004: http://www.ncdc.noaa.gov/img/climate/severeweather/hur5004.jpg

Hurricane paths by state from 1851 to 2005: http://www.csc.noaa.gov/hez_tool/history.html

        These have been bad years for those ad agencies that had counted on a continuing stream of media placements from free-spending golf communities.  That all ended with the housing crash.  In its most flush years, for example, The Cliffs Communities spent $14 million for marketing and bought prime positions in such high-end magazines as The

Robb Report, as well as just about every other four-color publication that appealed to golfers with champagne stock portfolios.  Ditto such successful high-end communities as Georgia’s Reynolds Plantation and Ford Plantation. Full-page, $100,000+ ads in the Wall Street Journal, for example, were common for dozens of golf communities trying to distinguish themselves and fetch a million dollars for an acre of prime dirt.  The major golf magazines (Golf Digest, LINKS, Golf magazine) provided lots of “editorial” coverage for the new golf community courses; all that “free” advertising was tied, of course, to the promise, if not the reality, of paid advertising.

        But since 2006, these high-end communities have largely been absent from the major paid media.  We all know what happened in the market, especially at the high end.  Over the last few years, only the financially strong –- or crazy –- golf communities have continued to throw good money at advertising, even though one could argue some counter-communications were needed to overcome perceptions that a $1 million home in a golf community is a risky buy.  Most communities rationalize their lack of spending; modern customers, they say, use the Internet to conduct research.  Maybe, but the hedge fund managers and their ilk who can afford the high-end properties likely have neither the time nor the inclination to conduct Internet searches.

        But they do read the Wall Street Journal.  And the increasing number of ads popping up for golf communities in

the Journal implies a revived sense of confidence in many of those high-end communities.  Today in the Wall Street Journal, for example, I noted sizable (1/4 page) ads for Hampton Lake in Bluffton, SC, The Landings in Savannah, and DeBordieu Colony in Georgetown, SC, located between Myrtle Beach and Charleston.  Another half-page “special advertising section” features a few golf communities in the Lowcountry between Charleston and Jacksonville, FL (and a sidebar about how Hampton Lake decided not to invest in building a golf course; instead, its residents can join one across the street).  Unless the Wall Street Journal has changed its rate structure dramatically in recent years, the total buy for these ads is at least $100,000.  That’s an investment these planned communities have not been inclined to make in recent years.

        “We have not done much marketing in a while,” says The Landings Vice President of Marketing Bill Houghton, “and we probably fell off the radar screen” amid all the earlier advertising by The Cliffs, Reynolds Plantation and others.  Houghton, who recently arrived at The Landings from a similar post at Reynolds Plantation, told me that The Landings' 2010 sales volume is ahead of last year, which gives Landings owners -– its residents –- the confidence to spend.

        Just like rehiring and investing in capital equipment typical signal restored health for corporations, advertising by

  planned residential communities could very well be a leading indicator of a revived market.  These communities are betting on more baby boomers coming off the sidelines and renewing retirement home searches that they postponed because of the recession.  The stock market, which is coming off one of its best 12-month stretches ever, is puffing up confidence among buyers.  This is good news for the Wall Street Journal and other advertisers, for the communities that have been waiting for buyers to return, and for the buyers themselves who have put off for a half a decade a planned move to warmer weather and a life of golf and leisure.

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We are still in a buyers market, but that could change by the end of 2010, especially in the mid-level ($400,000 to $750,000) segment of the residential leisure market.  If you are considering purchasing a golf community lot or home in the next couple of years, it is not too soon to start looking.  Contact me and I will be happy to offer you my thoughts based on your requirements.  I never charge for my services.

The Landings in Savannah, which features six golf courses and a debt-free balance sheet, is feeling confident enough to start spending on advertising in such venues as the Wall Street Journal.