A Conversation With Jon Schneyer
The 2023 hurricane season has so far been a wild ride — but that shouldn’t be a surprise. With the El Niño Southern Oscillation (ENSO) swinging into an El Niño pattern and reports of triple-digit ocean temperatures in the Gulf of Mexico, June through November was bound to bring some noteworthy activity, and that pattern could continue.
But what does the combination of El Niño — which is known to dampen hurricane activity — and record-breaking sea surface temperatures in the Atlantic have to do with an active 2023 hurricane season? Well, a lot.
The influence of these weather phenomena is readily apparent from the activity in the Gulf of Mexico at the end of August. From Hurricane Idalia, which brought considerable damage to the Florida coast, to Hurricane Franklin, which soaked Hispaniola and spun a little too close for comfort off the coast of Bermuda, the 2023 hurricane season is peaking. Not to mention that the season started off with the simultaneous appearance of Hurricanes Bret and Cindy.
In this episode, host Maiclaire Bolton Smith sits down again with CoreLogic Director of Catastrophe Response Jon Schneyer to talk about the science behind the interaction between ENSO and sea surface temperatures and how knowing a little science can help with seasonal hurricane predictions.
Learn More About Hurricanes
In This Episode:
2:20 – What is El Niño and what does it mean as we shift from La Niña to El Niño conditions?
3:50 – Are the patterns we are seeing this year abnormal?
6:42 – Erika Stanley goes over the numbers in the property market.
7:53 – How do ocean patterns affect hurricane activity?
12:03 – Are we on track to fulfill NOAA’s predictions of an above-average hurricane season in 2023?
13:51 – Update on the 2023 hurricane season.
You kind of have battling conditions that affect hurricane development and their potential to strengthen.
Maiclaire Bolton Smith:
Welcome back to Core Conversations: A CoreLogic Podcast, where we tour the property market to investigate how economics, climate change, governmental policy, and technology affect everyday life. I am your host Maiclaire Bolton Smith, and I’m just as curious as you are about everything that happens in our industry.
Summer is here, and along with summer comes hurricane season. For the last two seasons, La Niña brought cooler temperatures to the eastern Pacific, which created ideal conditions for hurricane development in the North Atlantic Ocean. But now the pendulum has swung in the opposite direction. As of June 8, El Niño conditions have arrived in the Pacific.
Now there is an increased likelihood of an above-average hurricane season. In part, this is due to elevated sea surface temperatures. Sea surface temperature patterns could impact storm conditions, a change that typically might be good news for those living and insuring homes in hurricane-prone regions.
However, the combination of El Niño conditions and hot ocean temperatures have primed the Atlantic for a stormy season. To dive into this and talk about these two phenomena and how they interact and what it means for the 2023 hurricane season, we are once again welcoming back one of our favorite guests, CoreLogic’s Director of Catastrophe Response, Jon Schneyer.
Jon, welcome back to Core Conversations.
Thank you so much for having me. It’s great to be back.
Okay, so this is very timely with where we are now. I did just say to someone the other day that I expect that within the next couple of weeks we are going to have really severe hurricanes on our doorstep. So, I want to dive into, is that actually going to happen and what things look like.
Before we talk about the 2023 hurricane season, I wanted to remind our listeners that we want to help you keep pace with the property market. To make it easy, we curate the latest insight and analysis for you on our social media where you can find us using the handle @CoreLogic on Facebook and LinkedIn or @CoreLogicInc on Twitter and Instagram. Now let’s get back to Maiclaire and Jon.
Okay, let’s dive in. I want to talk about El Niño. I think this is something that it’s in the news. I grew up in Canada. When I heard El Niño, that meant warm winters. I want to think about it specifically in terms of hurricane season. What is El Niño and what does it mean as we shift from La Niña to El Niño conditions?
Yeah, it’s a good question because it’s super relevant to the hurricane season this year. I know it meant a lot when you were living in Canada, but it means a lot for us on the East Coast here in the States or in the Gulf. El Niño is really just a phase of a larger cycle, and it’s called the El Niño Southern Oscillation or ENSO.
ENSO isn’t anything new. It’s a naturally occurring coupled climate phenomenon, and you can kind of think of it as changes in the Pacific Ocean temperature. I use the word “couple” specifically because changes in ocean temperature have a big effect on changes in atmospheric circulations and vice versa. They both play with each other. That’s what ENSO is. It’s really an oscillation between warmer temperatures in one part of the Pacific and colder temperatures in that part of the Pacific a couple of years down the road.
With ENSO, there are three phases. That would be La Niña, El Niño, and Neutral. You can kind of think of La Niña as a stronger version of Neutral, but Neutral is sort of that in-between.
That would be just typical conditions that we’re normally having on any given year. That’s not abnormal?
Exactly. Neutral is normal. ENSO is a natural phenomenon. This is nothing new. It’s been happening forever. During El Niño, ocean temperatures in the central and eastern tropical Pacific, so near the equator, eastern Pacific being right up against South America. The ocean temperatures heat up and the easterly winds, winds that move from east to west, will weaken and actually even sometimes change direction. Remember I said it’s a couple of phenomena. Temperature, ocean temperatures, atmosphere that play together. The opposite is true during La Niña. Ocean temperatures are cooler in the eastern Pacific. They’re warmer in the western Pacific when you get over towards Southeast Asia and you’ll have much stronger easterly winds. We’d like to focus on La Niña and El Niño conditions because they can affect global atmospheric patterns.
Okay. How often do they change? How often do we expect to see an El Niño season?
Yeah, so the long-term average is three to seven years, which is kind of a long range, but it’s something that happens. Like I said, it’s been naturally occurring for a long time. Prior to the start of this year, we were in a La Niña phase for quite some time, going back to June 2020, which is a pretty long stretch to be in one phase. It is quite a feat. It’s not unprecedented. There’ve been other examples. Spring 1954 to the fall of 1956, same deal. We had it again in the early 70s for an extended period of La Niña conditions. It’s nothing new. It has been quite a long time of La Niña, but there’s precedent for it.
Is it typical that it stays in a Neutral pattern for kind of an extended period of time, goes to La Niña, goes to El Niño, and those are generally shorter, but in general, Neutral would normally be those longer conditions?
I like to think of it as kind of like a metronome. It’ll swing back and forth, maybe a weighted metronome, maybe it hangs out a little bit with a little bit of momentum on one side and it’ll kind of swing back the other way. Then again, there have been really short periods of El Niño and La Niña as well as extended periods of Neutral. It can vary. Then the strength of which. It can be a really strong El Niño versus not a particularly strong El Niño. There’s a lot of variability in there.
Right, so just a pendulum that goes back and forth.
It’s that time again. Grab a cup of coffee or your favorite beverage. We’re going to do the numbers in the housing market. Here’s what you need to know. In mid-August, the average 30-year, fixed rate mortgage reached its highest levels in 21 years. This interest rate increase further erodes U.S. home affordability and discourages owners from tapping home loans against their accrued equity.
Demand for HELOC loans, or home equity lines of credit, surged in 2022. This year though, the count of HELOC loans decreased by 26%. Still, it’s worth noting that the HELOC market is keeping pace with its pre-pandemic level.
Now turning our attention to investors. U.S. home investors share over the past two years has held steady. In March, 2023, investors accounted for 27% of all single-family home purchases. In June, that number was almost unchanged at 26%. What is notable is that small investors with three to nine properties are growing their market share. Meanwhile, mega investors, with over a thousand properties, have seen their share drop from 17% of all investor purchases to 8%. U.S. investor share was concentrated in the following states, California, Washington D.C., Georgia, New Mexico, Texas, Nevada, Utah, Arizona, and Kansas. Find out more about the property market on the CoreLogic Intelligence blogs. The link is in the show notes, and that’s The Sip. See you next time.
A couple of things there. Let’s dive in. I want to talk specifically about ocean patterns and how they affect hurricane activity. I know there’s been a number of times that I’ve been in the Gulf and I’m like, “Oh my goodness, the water’s so warm. We’re going to get —” I remember in 2017 in the middle of August, and my husband talks about this all the time, that we were at the Gulf and I’m like, “This is crazy. The water is so warm. We’re going to get a major hurricane within the next two weeks.” And within I think 12 days, Hurricane Harvey hit, so everybody thinks I’m a predictor of hurricanes.
You should be working at NOAA.
Which I’m not, just I know how these conditions can impact hurricane season. There’s been a lot of news this year that the temperatures are so warm. I think one news report was the waters off Key West were over 100 degrees, like 101-degree water temperatures. That’s insane. What does all of this mean for hurricane generation and hurricane season?
Yeah, it’s a good question and it’s one that forecasters had to deal with at the beginning of hurricane season, and they’ve actually made updates to their forecast recently to reflect that. You kind of have battling conditions that affect hurricane development and their potential to strengthen. One of the things about El Niño is because of where the warmer ocean temperatures are, that has an effect on the circulation of air in the atmosphere. When we’re in El Niño, it means you have stable, sinking air in the Atlantic Ocean and hurricanes don’t like that. Hurricanes like instability. They want air to be rising because it’s sort of their general motion. El Niño is pushing on one side and it’s impeding hurricane development. Like I said, more stable air, more vertical wind shear, not good for hurricanes.
On the other hand, like you mentioned, the Atlantic Ocean is really hot. Really, really, really hot. Way hotter than the long-term average. Even back right before hurricane season, we were above the historical average, notably in areas where hurricanes like to develop, whether that be off the coast of Africa as waves across that sort of region of the Atlantic where hurricanes start to go from a wave to a storm to a hurricane and in the Caribbean. The Caribbean’s blazing hot. Hurricanes, while they don’t like stable air, they love ocean temperature. Hurricanes are heat engines and warm oceans are the fuel, the gasoline that powers those engines.
Prior to the season, we didn’t exactly know when El Niño would show up, how strong it would be, but we knew it was coming and what was the probability of it coming? That’s what we were trying to figure out. The battle was, what’s going to be more impactful: El Niño or warm sea surface temperatures? At the beginning of the season it was, well, we really don’t know. There’s a lot of uncertainty. We’re saying a near normal season, maybe below average, maybe above average, but we’re not sure. Because of how hot it’s been in the Atlantic Ocean, forecasters are starting to say the effects of warm sea surface temperatures are going to overpower the effects of El Niño when it comes to hurricanes. The most recent forecast from NOAA released back on Aug. 10 is now increasing the likelihood of an above average hurricane season.
Originally, NOAA, the National Oceanic and Atmospheric Administration, said that these El Niño conditions were expected to strengthen over the course of this year. This shift has the potential to prevent hurricane development, but on Aug. 10, NOAA revised its forecast. Now there is an increased likelihood of an above average hurricane season. In part, that is due to elevated sea surface temperatures.
Okay. Have we seen any indication of that yet?
What I would say is it’s a little on the early side to call. Obviously, you’re not going to be able to call until the end of the season whether it’s actually above the average amount. We’ve had named storms up through the letter D, up through Don, which was a hurricane spinning out in the Northern Atlantic.
Not a lot.
Well, not a lot, but those first five: A, B, C, D, no four, were in the early part of the season, which is actually pretty normal. That’s actually not unheard of to have a bunch of activity right at the beginning. We had this last year, actually, if you remember, we had a bunch of storms beginning the season then a really long lull. Hurricane Don, that was July, 20, 21, that area. It’s actually been several weeks since we’ve had any hurricane activity.
When we think about how active a hurricane season is, we like to use a metric called ACE or accumulated cyclone energy. It’s like a running total of the amount of energy from hurricanes or tropical storms. If you look at that ACE graph through time, we’re pretty much at normal. It’s usually pretty flat through the first part of the season, but it’s right about this period of the hurricane season, mid-August is when it starts to spike. This is where we start seeing a lot of hurricane energy.
Right. Harvey, Katrina, all of the big ones are always in that kind of late-August time period.
Exactly. It’s late August, it picks up until about mid-September, and then it’ll start to drop off. We’re really just about to hit the peak of, historically speaking, of when we have a lot of hurricanes or strong hurricanes.
Shortly after this episode was recorded, Maiclaire and Jon’s prediction about hurricane season revving up proved true. Hurricane activity was teeming in the last week of August. The Florida Gulf prepared for Hurricane Idalia while Hurricane Franklin soaked Hispanola and spun a little too close for comfort off the coast of Bermuda.
Fun fact about “I” names for you listeners. Hurricane names are retired after extremely deadly or costly storms for sensitivity. And the letter “I” claims 14 out of the 94 names that have been retired.
Meanwhile, in the Pacific, Hurricane Hilary made landfall over the northern Baja California peninsula, soaking the southwestern U.S. Tropical storms are rare in the western U.S. due to the typically dry air and very cold ocean temperatures that inhibit hurricane development. The last time a tropical storm made landfall in Southern California was in 1939.
Okay. A couple things. This is really interesting and really important, but I think one thing that’s really important to point out is NOAA is saying it could be a active hurricane season. Active simply means there could be more events. Not that those events will hit a big city. I think that’s a really important clarification that we need to make, that it’s not necessarily saying that these events will hit, but the more events there are, the more likely possibility that it may hit an urban or populated center. I think that’s an important thing to point out.
Maiclaire and Jon spent this episode talking about how the shift into El Niño weather patterns and elevated surface temperatures has primed the U.S. for an above-average hurricane season. In the next episode, they’ll dive into how insurers might fare if there is another major hurricane that results in major losses. As always, we’ll pick back up next week. See you there.
Thank you for listening. I hope you’ve enjoyed our latest episode. Please remember to leave us a review and let us know your thoughts and subscribe wherever you get your podcasts so you know right when new episodes are released. Thanks to the team for helping bring this podcast to life. Producer, Jessi Devenyns; Editor and Sound Engineer, Romie Aromin; our Facts Guru, Erika Stanley; and social media duo, Sarah Buck and Makaila Brooks. Tune in next time for another Core Conversation.
You still there? Well, thanks for sticking around. Are you curious to know a little bit more about our guest today? Well, Jon Schneyer is the Director of Catastrophe Response here at CoreLogic. Jon aims to keep CoreLogic clients informed of weather risks by monitoring potential events, determining the scope of the response, coordinating with internal stakeholders, and providing up-to-date content. You can read more of his event response coverage on hazardhq.com. The link is in the show notes.
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