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The United States, and more specifically the Northeast states, are experiencing one of the largest hurricanes of all time. At about the same size as the state of Texas,
Hurricane
Sandy has blown through the Northeast coast, leaving many New Yorkers in
complete tragedy throughout the last few days of October 2012. Sandy has threatened an estimated 284,000
homes and has caused approximately $87 billion in damages, according to CoreLogic. Massapequa, located on the South Shore or
Long Island, has more than $4.6 billion in total structure value at risk alone.
The impact of what is now being referred to as “Superstorm
Sandy” does not only affect many families in the New York area, but Inman
News has also reported that natural disasters, much like this one, can have
a “chilling” effect on the real estate market.
How so?
When natural disasters occur in certain areas, home buyer
confidence greatly decreases. In
addition, these catastrophes have been proven to stall mortgage operations,
hurt home sales and have even more dire consequences when combined with the
current economic factors that our nation is experiencing.
Take one of the nation’s most famous hurricanes of all time,
for example—Hurricane Katrina. Hurricane Katrina did
more than kill more than 1,800 people and displace 750,000 households. In addition, the number of homes sold in New Orleans
dropped approximately 23% in just one year (May 2008-May 2009).
The same exact outcome was reported in the real estate
market after the 1989 and 1994 earthquakes in San Francisco. Even after the massive oil spill on the
Gulf Coast (although it was a man-made catastrophe rather than a natural
disaster), the market crashed. In fact,
the Gulf Coast oil spill impacted the real estate industry so much that $60
million of BP’s $20 billion Claims Fund was set aside for real estate
professionals.
But that’s not to say that all catastrophes have a negative impact on the real estate
market. One of the biggest surges in the
New York market happened immediately after 9/11. After the terrorist attack, many home buyers
took a stand against terrorism by purchasing even more homes in the beginning
of 2002.
Our homes mean everything to us—not only do they keep us
safe and provide us with shelter, but they also hold a some of our favorite memories. However, if you or your home
ever undergoes a natural disaster, there are a few steps to take to alleviate
the problem:
- First and foremost, take safety precautions. Keep in mind that the water flowing into your home may be contaminated and should not be used until advised so. Be mindful of trees and other structures that could be unstable around your house.
- Secondly, seek medical attention if needed. Make sure that emergency services are able to get to your house or provide them with a safe alternate route in order to get there. Always keep in mind where power lines and bridges are located.
- Next, safeguard your property. Assemble your most prized possessions and find a safe place for them.
- Contact your insurance company. Take the time to fully understand what your homeowners or renters insurance policy does and does not cover.
- Next, contact your creditors. Make sure that your creditors are fully aware of what has happened and provide them with a temporary address if possible.
- Finally, it’s time to do one of two things—repair or relocate.
Natural disasters are an absolute tragedy and cannot be avoided. From hurricanes to tornadoes, floods to fires, earthquakes to eruptions, we never know what to
expect from Mother Nature. The best
thing to do during a time of natural disaster is to remain calm and stay
safe.
