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October 25, 2014

Real Estate Opportunities Surface Following Sandy

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Real Estate Opportunities Surface Following Sandy

Following the devastation of Hurricane Sandy, many areas along the East Coast are looking to rebuild, and many housing markets are expected to get a lift after the storm. 

Usually, such severe storms cause the housing market to grind to a halt, later followed by a flurry of activity, says Walter Molony, spokesman for the National Association of REALTORS®. Following Hurricane Katrina, “we saw a surge in sales in areas that survived. Sales in unaffected areas usually rise above expected levels.”

The destruction from Hurricane Sandy is expected to be the second costliest storm on record, behind only Hurricane Katrina, according to insurance analyst firm Eqecat.

The storm ravaged 127 miles of the Jersey shore, where homes worth hundreds of thousands to millions of dollars were damaged in Sandy’s wake. Some home owners may find they can’t afford to repair the damage to their homes and will have no other option than to sell. 

“Flood insurance coverage and the money that comes from FEMA is likely to be insufficient, so people are going to get caught short,” says Jeffrey Otteau of Otteau Valuations. “Some may put their home up for sale ‘as is.’”

As a result, “that may lower property prices, and at the same time open the door to speculators,” reports New Jersey’s Star-Ledger.

Investors are expected to flood the market. “There will surely be investors going door to door offering to buy for cash, saying ‘I’ll take it off your hands right now,’ with the idea of rebuilding and selling, or holding the property as an investment,” Otteau says.

Source: “Real estate at the Shore: Opportunities likely,” The  New Jersey Star-Ledger (Nov. 4, 2012)