Forest fires rage on in Chile; at least 112 dead
SANTIAGO, Chile — Firefighters wrestled Sunday with massive forest fires that broke out in central Chile two days earlier, as officials extended curfews in cities most heavily affected by the blazes and said at least 112 people had been killed.
The fires burned with the highest intensity around the city of Viña del Mar, where a famous botanical garden founded in 1931 was destroyed by the flames Sunday. At least 1,600 people were left without homes.
Several neighborhoods on the eastern edge of Viña del Mar were devoured by flames and smoke, trapping some people in their homes. Officials said 200 people were reported missing in Viña del Mar and the surrounding area. The city of 300,000 people is a popular beach resort and also hosts a well-known music festival during the southern hemisphere’s summer.
On Sunday morning, Chilean President Gabriel Boric visited the town of Quilpé, which was also heavily affected by the fires and reported that 64 people had been killed. Late Sunday, Chile’s Forensic Medicine Service updated the confirmed death toll to 112 people.
Boric said the death toll could rise as rescue workers search through homes that have collapsed. Some of those arriving in hospitals also were in critical condition.
Rodrigo Mundaca, the governor of the Valparaiso region, where Viña del Mar and other affected cities are located, said Sunday he believed some of the fires could have been intentionally caused, echoing a theory that had also been mentioned Saturday by Boric.
“These fires began in four points that lit up simultaneously,” Mundaca said. “As authorities we will have to work rigorously to find who is responsible.”
The fires around Viña del Mar began in mountainous forested areas that are hard to reach. But they have moved into densely populated neighborhoods on the city’s periphery despite efforts by Chilean authorities to slow down the flames.
On Saturday, Boric said that unusually high temperatures, low humidity and high wind speeds were making it difficult to control the wildfires in central Chile, which have already burnt through 30 square miles of forest and urban areas.
Boric flew over some of the areas burned by the fires Sunday and visited a school that has been turned into a shelter for the displaced. He said that a presidential vacation home on the shores of Viña del Mar that is surrounded by large gardens would be temporarily converted into a leisure center for the children of families affected by the fires.
The president declared two days of national mourning.
“All of Chile is suffering” Boric said. “But we will stand up once again.”
When Joel Adler decided it was time to downsize from his six-bedroom house in Parkland, Florida, where he had lived for more than 20 years, he was disappointed with the lack of options.
“There weren’t a lot of homes to look at,” said Adler, a 76-yearold retired teacher, who had been searching for a year and a half.
Eventually, he turned to Valencia Sound, a gated community in Boynton Beach, Florida, that opened in 2019, joining the growing ranks of homebuyers who opted for a newly built house instead of an existing one, a rare bright spot in an otherwise gloomy market.
The housing market has been mired for much of the past year, bogged down by high prices, soaring mortgage rates and a dearth of inventory, pushing many would-be buyers to the sidelines.
Existing homes typically account for about 90% of sales, but homeowners who have locked in low-rate mortgages have been reluctant to sell, resulting in limited choices and sky-high prices for prospective buyers. Last year, existing-home sales fell to the lowest level in nearly 30 years, while the median price hit a record high, according to a recent report by the National Association of Realtors.
That spurred a rise in construction, as developers rushed to meet demand and dangled incentives to entice buyers. Sales of new homes jumped 4.2% last year from 2022, the Census Bureau reported last month.
“The new-home market has been a bright spot, bucking the trend a little bit,” said Odeta Kushi, the deputy chief economist at First American Financial Corp., a real estate services company. The inventory of new homes now makes up 30% of the overall market, she noted, up from 11%.
The expanding choices of new homes appealed to Steve Hawthorne, a co-owner of Vertical Runner, a shoe store in Hudson, Ohio. After owning older homes for most of his life, he said, he was burned out by maintenance costs.
“This is a big headache,” said Hawthorne, 49. “When the prospect of buying another house came about, I thought this time, I’m going to buy a new home.” Plotting a move west, he bought a two-bedroom house in Summerlin, a planned community outside Las Vegas developed by Howard Hughes Holdings.
Buyers like Hawthorne are providing a jolt to the economy; residential investment, which includes the construction and purchase of new homes, jumped in the second half of last year, rising at a 6.7% annual pace in the third quarter and 1.1% in the fourth, according to the Commerce Department.
That is a boon for developers like Howard Hughes, which in its most recent earnings report said it sold twice as many new homes in the third quarter as it had the year before. “Our job is to make sure we have enough houses to meet that buyer demand,” said David R. O’Reilly, the company’s CEO.
Since March 2022, the Federal Reserve has increased interest rates 11 times in an effort to tamp down inflation. That led to higher mortgage rates: After falling below 3% during the pandemic, the average rate for a 30-year fixed-rate mortgage jumped above 7% last summer, and has recently hovered around 6.7%, according to Freddie Mac.
“The consensus is mortgage rates are going to stay at these levels for a while,” said Jeff Ostrowski, an analyst at Bankrate, a consumer financial services company. His firm has forecast that mortgage rates will fall below 6% by the end of 2024, as the Fed has signaled it will begin cutting rates this year.
It will take time for the housing market to adjust, as the supply of homes — new and existing — rises and puts downward pressure on prices. “There is a real shortage of inventory,”
Ostrowski said. “I got a phone call from somebody this morning asking if I want to sell my house.”
Home prices nationwide inched up 0.4% in December from the month before, the third straight month of slower growth and the smallest increase since June, according to a report from Redfin, a real estate services company.
New homes are typically more expensive than existing ones, and builders are reconfiguring floor plans and shrinking room sizes in an effort to appeal to budget-conscious buyers.
Sellers of new homes are also offering incentives like discounts on mortgage rates and upgraded features like new appliances and countertops, said Kushi, the First American economist.
“It’s an affordability question,” she said. “How do you get people in the door? As a builder, you don’t want to lower prices.”
Hawthorne, the buyer in Nevada, said he was able to negotiate a new washer and dryer and epoxy flooring in his garage. “In the grand scheme of things, they were not big-money items, but they were nice amenities,” he said.
And by opting to buy a new home when he did, Hawthorne said, he encountered less jockeying from rival buyers.
“When money was cheap, competition was immense,” he said. “When I closed at the beginning of September, there was hardly anyone looking.”