In years past, homebuyers have avoided markets recently affected by natural disaster; however, the latest hurricanes and subsequent flooding have hit some of the most valuable real estate in the country. As “for sale” home prices typically drop as a result of natural disaster, potential homebuyers have flooded the affected markets - and they’ve found rising home values in these areas.
Hurricane Harvey, for example, damaged thousands of homes in the city of Houston alone. Although many homeowners are still recovering, the housing market as a whole has rebounded much quicker than expected. Alina Ptaszynski, spokesperson for real estate giant Redfin, even stated that “Redfin agents were touring homes and writing offers for clients the week after the storm. Since then, the number of calls Redfin agents received from real estate investors has quadrupled.”
Homes unaffected by the flooding drastically rose in value, as many home sellers were forced to take their homes off the market to make necessary repairs. As a result, “unflooded homes are being advertised as such and seeing solid buyer interest,” according to Ptaszynski.
Similar to Houston’s housing market post-Harvey, Baton Rouge residents witnessed a quick bounce-back after last year’s floods. According to Bill Cobb, an appraiser with Accurate Valuations Group, the stigma of buying flooded properties has certainly declined. In some neighborhoods, home buyers were even offering an average of $13 more per square foot of home after the floods.
Overall, home values and prices have been rising in the most disaster prone areas. More specifically, the latest Attom Data Solutions study shows that home prices in high-risk areas have risen 55 percent since 2012.
Of course, this does not mean every home price will rise after a natural disaster. Many will remain low to draw more buyers into the market. For more information about buying a home in an area affected by natural disaster, or to learn more about home financing in general, contact one of our mortgage specialists today.