Danea Kelly made her first shopping trip for a New Jersey shore vacation home on the Saturday before Hurricane Sandy made landfall. It won’t be her last.
While Kelly, 41, decided she no longer wants property directly on the ocean, the storm may open up new opportunities.
“You take your chances anytime you get involved with real estate,” said Kelly, who is house-hunting with her brother in North Wildwood, which dodged the worst of the Oct. 29 storm that tore apart the boardwalk in Atlantic City, 40 miles (65 kilometers) up the coast. “We may now have less competition from other buyers and it might steer some people who have lived down there a long time, who may decide, ‘It’s time for me to sell.’”
Real estate markets on the Jersey Shore will suffer in the wake of Sandy, which inflicted as much as $50 billion of business and property losses and caused at least 100 deaths in the U.S. In the hardest-hit communities, rebuilding of bridges, roads, dunes and homes will take months or even years. Home construction and insurance costs will probably rise.
While it will take time for buyers to regain confidence after the storm and last year’s Hurricane Irene exposed the vulnerabilities of oceanfront property, they will return, as they did to storm-wracked beaches in Florida, North Carolina and Texas, said Lawrence Yun, chief economist for the National Association of Realtors.
“The allure of having an oceanfront property is just too great,” Yun said in a telephone interview from Washington. “People recognize that there are bad natural-disaster events and they just cross their fingers and hope it doesn’t happen to them.”
When house-hunters come back, they’ll compete for a reduced supply of undamaged homes with higher asking prices, according to Yun. Rebuilt properties will feature costly upgrades such as sturdier roofs and wind-resistant windows, which also may push up resale prices.