Aftermath of Hurricane Sandy: How Natural Disasters Effect Real Estate

Pretty much every place on earth is prone to some form of natural disaster, whether it is a hurricane, tornado, earthquake, volcano, tsunami, or something else. These natural disasters definitely have an impact on the real estate market, especially when an area is still rebuilding after the damage. So, how did Hurricane Sandy affect the real estate market in New York City?

How Bad Was Hurricane Sandy?

Hurricane Sandy

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40,000 people were displaced because of Hurricane Sandy and over 130 buildings were left inhabitable. On top of that, thousands of families were left without power for more than a week—the worst part was that this was in 30-degree weather. According to the mayor, up to 40,000 people could need new housing in New York City. So, Hurricane Sandy was pretty bad.

What Was the Real Estate Market Like in New York City Immediately After Hurricane Sandy?

Real Estate Market

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New York City has traditionally been one of the highest-value real estate markets in the United States, specifically the Manhattan area. However, there is no doubt that New York City’s real estate market was affected by Hurricane Sandy. Several families definitely decided to move from the area because of the hurricane. However, the rental market seemed to surge, probably because so many people were displaced due to the storm and needed a place to stay quickly. There were some delays in real estate transactions, but New York City’s real estate market wasn’t hurt as badly as other areas historically.

What Can We Expect from New York City Real Estate in the Coming Years?

New York Real Estate

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If you take a look at other real estate markets that have been affected by natural disasters, you see a depressing trend. For instance, four years after Hurricane Katrina, there was still a 23 percent drop in home sales in New Orleans from before the devastation. Additionally, San Francisco and the Bay Area had a practical home sale halt after the 1989 earthquake. The California real estate market has mostly recovered since, but it was pretty rough for about a decade.

So, will the trend be the same for New York City? Will people stop buying real estate for a while? Experts say it won’t. This is because New York City already had a limited amount of properties for sale before Hurricane Sandy hit, and with so many displaced families, there will be a lot of competition to get new housing. Real estate agents are being pushed to their limits to help people find places to live.

Does the fact that you might experience a natural disaster go into your decision to buy a home? For instance, would you be less likely to buy real estate in New York City because you know there could be another hurricane like Sandy some day? Most people say, “Yes,” but at the same time, there really isn’t any place that is immune to suffering a natural disaster.

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