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How Will the Real Estate Market Weather the Storm?

What will happen in a post-Sandy real estate market?

Hurricane Sandy has done her damage to some, and others fared very well through this storm.

Overall, Ocean City got very lucky compared to other parts of New Jersey and New York. Many sellers have been expressing a concern as to what Sandy's wrath will do to our previously recovering real estate market. Though it is hard to see right now, I am sure there will be some good with the bad.

In talking to some of my buyers within the past few days, they still express a love for our town and will always have a drive to want to be here. Surprisingly, many sellers whose homes stayed dry feel even more confident about their property and their sale.

The main issue that we are currently facing is mortgage companies wanting inspections on the properties that are under contract and pending a settlement. They want to be sure that there are no severe damages. The problem lies with certain buyers having to wait for repairs to be completed in order to get a re-inspection and approval for financing. Getting a quick resolution in order to hold a deal together seems impossible when insurance companies need time to get adjusters out to so many homes. Trying to get an available contracter out to make the repairs also may be a difficult task.

Some good news that I have heard from homeowners is that they are now rehabbing items in their homes that they normally would not have put the money into. Things such as flooring and furniture that are normally very important to buyers, so many people typically would have kept or even sold "as is." Therefore, the property that they and their family has owned for numerous years will now be worth even more and they are excited about it. This is one positive outcome for many of the older and lower-built homes that did get the brunt of the damage.

It is inevitable that the market will slow down for the next few months while people are filing claims and completing repairs. However, Thanksgiving to New Year's are typically our slowest real estate months regardless. Coincidentally, we have seen a few buyers come into town wanting to explore where the highest and dryest areas of town are. Good for some but very revealing for others.

I will surely expect the "Sandy" question to now be on the list of buyer's concerns for the next few years. Overall, I don't think the storm will have a permanent effect on our market. Ocean City was one of the shore towns that best survived this catastrophe, so renters and buyers may end up here.

I am eager to hear what any potential buyers and second homeowners think about buying right now and what sellers feel about their properties regarding pricing/value.

This post is contributed by a community member. The views expressed in this blog are those of the author and do not necessarily reflect those of Patch Media Corporation. Everyone is welcome to submit a post to Patch. If you'd like to post a blog, go here to get started.

Bill Bunt November 06, 2012 at 09:19 PM
I've been looking to buy property in OC for the last few months, and I can say Sandy has me more determined than ever to find something. I'm not discouraged one bit.
Caroline Watts November 06, 2012 at 09:20 PM
Bill that is great to hear!!! Curious on why you feel that way. Would you share with us?
WilsonWWilson November 07, 2012 at 12:36 AM
I have read some interesting articles on this subject that indicate the market value of individual island / barrier communities may vary. The variables will be how the island held up to SANDY and also the response to this catastrophe. This storm coupled with Irene and the derechio has added grip to the Global Warming and Climate Change theories. Political fallout from groups who oppose barrier island federal aid will use this opportunity to lobby for less spending and stricter legislation which will include stricter building codes, more difficulty getting flood insurance and less federal aid for infrastructure project. My read on this means many areas north of Ocean City that were devastated may not be able to re-create their towns to their prior capacity and luster. If this occurs Ocean City properties are positioned to increase in value.
Mary B November 07, 2012 at 12:53 PM
There were many homes in OC that sustained no damage; mine being one of them. My neighborhood is a known "high spot" on the island and never lost electrical power. As I toured the north and south ends of the island I was dumbfounded by the invasion of sand and flooding but also truly impressed with the speed and quality of the cleanup directed by the city. Better than real estate, the people of OC are strong and resilient and are determined to return to "normal" life. You can feel the sense of community.
Mary Lou Todd November 07, 2012 at 01:47 PM
I completely agree with Mary B. We recently bought a home in OC and we weren't able to check on things until this past weekend. I, too, was truly impressed with everything I saw -- from neighbors helping neighbors, to the cleanup, to the "neatness" of it all. Didn't see debris all over the place -- what was there was in orderly stacks and piles in front of houses and in alleys. Kudos to OC!
John Speak November 07, 2012 at 10:12 PM
I recently bought a home on 57th and West. I have an interesting story about the storm, and a question. When leaving Sunday morning before the storm I emptied the freezer. I forgot a few ice pops. When I returned Wednesday afternoon I was amazed to find that they hadn't melted. My concern and question is how long and to what extent the beach will be restored.
donna November 12, 2012 at 05:19 PM
Hello Bill Blunt, we did not discover until after the storm that we lived in the neighborhood known as the "high spot" Our home did not even lose power during the storm, and there was no water damage at all. It was like nothing ever happened. We are 110 steps from the sand, beach block. Would be a great property if interested.
Caroline Watts November 12, 2012 at 05:37 PM
Hi Donna, is your property listed? What is the address? We cannot identify you and therefore the the property through this post. If you can email me the info at caroline.watts@prufoxroach.com I would be happy to spread the word.
donna November 13, 2012 at 08:41 PM
Does anyone know what to expect about the real estate market, now that the shore is returning to normal. If you have your house for sale now, what timeframe should we expect before the interest comes back? After the holidays, early spring, or early summer?
Caroline Watts November 13, 2012 at 09:01 PM
Donna, honestly from Thanksgiving to New Years is our slow time anyway. We normally have some sales but everyone seems to be more focused on the holidays. I am pretty sure you will see things pick up as usual just around March/April. With the holiday distractions and then the sun coming out people will have put Sandy in the past.
Judy November 15, 2012 at 11:10 PM
So is there any market for renters over the winter with folks that have been displaced? My home for sale is just sitting there and had no damage. It might be nice for it to go to good use over the winter.
Neil Kaye November 16, 2012 at 01:08 AM
Judy, why not offer the use of your house free to someone who really needs it?
Greenbyrd November 20, 2012 at 08:16 PM
Hi Neil and Judy, If you own a second home on the island, please consider allowing a family to use your home. Even though Ocean City was not hit too hard by Sandy, many people have lost everything due to the flooding. We called City Hall a few days after the storm and offered our warm, dry home to a family in need, and within two days, a family was moved in! We are not charging rent. It is a good feeling to be able to help others. Maybe you could just ask for the cost of the utilities, or a small amount of rent. But, offering your vacation home for a few weeks, or months can change someone's life...and make you feel "Thankful"
OTI December 06, 2012 at 01:32 AM
Greenbyrd, Thank you for offering your home. My family and I are one of those families who have lost everything. We are very fortunate to have been given a beautiful home to stay in by a good friend, who is unwilling to accept any money. I just wanted to say thank you for being so kind to others, it really does make a difference.
Ann Sparks January 03, 2013 at 12:53 AM
I have been looking to purchase in OC a months before Sandy hit, now I am having questions that I am concerned about. Several advisors have told me to wait and see how this will unfold in the upcoming year or two, as that is the amount of time to assess situations after a disaster. Especially in an uncertain economic times. My specific questions are : how is this going to affect the housing market in OC? I think potential buyers are concerned about several things including where on the flood zone the property will fal on; how much the flood insurance is going to go up...to raise HOA fees if you have them; will the home be insurable (regular home insurance where I suspect wind was an issue) ; and if you are dealing with a home >20 years older, how structurally sound will it hold with upcoming storms, especially if you live near water and in an older community.
archie struthers January 05, 2013 at 02:58 PM
Ann, I've lived here thru a bunch of storms and Sandy was quite likely the worst since 1962. Lots of bad alignments in tide , wind and temperature. Don't know the kind of house you are looking at , whether its for summer or year round use, and whether you intend to rent at all. However a good realtor can tell you the history of flooding in the city, and the new flood zones are available online at the FEMA site. Still a little tricky trying to see the insurance implications, but the key is to research a particular neighborhoods propensity to flood. Sandy really reinforced where the best spots are relative to water and tides. Good luck. Archie/Struthers Keller Williams OCNJ
EXiT REALTY OCEAN CITY February 13, 2013 at 06:37 PM
... This topic is interesting. I am currently having many discussions with Buyers as to the uncertainty on purchasing homes that are below base flood elevation 10ft (older homes), as well as Buyers interested in purchasing homes that were built in most recent years. It appears to me that Buyers searching for newer homes and condos are slightly more decisive. There is not much of a difference between the two, and the low mortgage rates certainly can help. In my opinion the "toss-up" is between the offered pricing which is not much of a difference, and the base elevation of 10ft. above sea level vs. current new construction which will be built an additional 2ft. higher. This makes sense as the new homes are being built at that higher base flood elevation, these homes will also meet the new building codes moving forward, and finally your FLOOD Insurance premiums will be significantly less. I hope this helps…thank you! Joseph Landicini, Broker 1301 West Ave A-1 OCNJ 609.525.9901 Ext. 14
EXiT REALTY OCEAN CITY February 13, 2013 at 06:38 PM
Lets chat Home Sellers… here are my current findings; ...Home Sellers on the Island are concerned about their homes’ marketability should they consider selling in the future. Some of these Home Owners are seeking out answers to some great questions, and so through some good conversation and fact finding, as well as my knowledge in both construction and real estate sales, we are together formulating a plan that makes sense to them. There are options out there for us all in this adverse time. Ocean City will get through this no doubt and we'll be better for it. Joseph Landicini, Broker 1301 West Ave A-1 OCNJ 609.525.9901 Ext. 14

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