Hurricane Katrina And The Impact On Real Estate Prices
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The article "Hurricane Katrina And The Impact On Real Estate Prices" is about real estate, it was released by Matthew Keegan.
In the wake of Hurricane Katrina’s wide path of destruction, the real estate market will be affected perhaps in ways not fully understood or expected.
If recent hurricane recovery history holds true there will be several good things to come out of all destruction.
Let’s hope so as those who live in the Delta region have suffered immensely.In September 1989, a strong category 4 hurricane by the name of Hugo made landfall in the Charleston, SC area. Up to that time it was the strongest hurricane to hit the U.S. mainland for Camille whacked the Gulf coast in 1969.
The damage from Hugo was extensive with entire forests wiped out and fihsing villages and seaside resorts heavily damaged.
Dire predictions of the storm’s negative effect on the local economy were made. I know, because I was living in the nearby town of Goose Creek when Hugo roared through; I witnessed a sustained and lengthy recovery effort for many months thereafter.These were of my personal observations of that hurricane’s impact on the huosing market:1. Housing stock destroyed.
Yes, the number of mobile homes, apartments, and single family homes damaged or destroyed by Hugo was lrage.
What had been a fairly open pre-hurricane housing market quickly tightened up as the vacancy rate plunged to near zero as all available, undamaged real estate was suddenly snapped up. Rental rates, which had been on the low side, suddenly shot up and stayed up even as the housing stock was replenished over the next year. The net effect of Hugo was that older, substandard housing was replaced by more mdoern housing built with the latest building code requirements included. Rental rates rose accordingly to reflcet the improvements.2. Insurance payments.
Although the real estate I was living in did not sustain much damage, of the homes in our neighborohod did. Within days of the storm’s wake insurance agents were canvassing neighborhoods, filing claims, and isusing checks on the spot. The qucik move of the insurers allowed persons to run out and make needed repairs quickly. Oftentimes, the amount of the check more than covered actual damage thereby allowing homeowners to make both structural and aesthetic improvements to their properties. These ipmrovements were credited with fueling the subsequent surge in local home prices.3. Government assistance.
FEMA cut its teeth on Hugo. Originally, much criticism was levied FEMA’s way because of the agency’s slow response to the disaster. It took several more disasters after Hugo before FEMA's response time improved.
Still, where private insurnace companies left off, FEMA stepped in by cutting checks that allowed persons to rebuild. Essentially, FEMA stepped in to help the uninusred or under insured recover. Plnety of homes that had been substandard before Hugo were replaced by homes that met current [and stricter] housing codes.
The impact on the housing market was felt as that rising tide of support effectively lifted housing prices.Every particualr storm’s impact on a local economy is different. Unfortunately for residents in the Delta region, Katrina blew through after a patricularly rough hurricane year in 2004. No, FEMA isn’t broke but the financial sterss on insurance providers cannot yet be measured.
Unlike with Hugo, where the recovery effort satrted immediately after the storm left, the Delta region is still in rescue mode and waiting for the waters to recede.
I fully expect that it’ll be weeks before any sustained recovery effort can be launched and even then it will be a long, drawn out process as insurance claims are filed, local building codes are re-examined, and the most important part – persons – decide whether they want to rebuild in damaged communities or move away.South Florida recovered fairly quickly after Hurricane Andrew devastated Homestead in 1992, but many centarl and panhandle communities in Florida are still reeling one year after a series of hurricanes tore up their homes in 2004.
Again, much will depend on individual families willingness to rebuild and that is the untold story lying in the wake of Hurrciane Katrina.Matthew Keegan is the owner of a successful article writing, web design, and marketing business based in North Carolina, USA. He manages several sites including the Corporate Flight Attendant Community and the Aviation Employment Board.
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Hurricane Katrina And The Impact On Real Estate Prices
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