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Effects of Hurricane Damage on Shore Real Estate Market Uncertain

3-21-13

By Lauren Wanko
NJ Today

Hurricane Sandy ripped homes from their foundations. Entire houses were swallowed by the storm surge. Nearly six months later, shore homes and their homeowners are left in a state of disrepair and left to wonder how the superstorm impacted the real estate market along the coast.

“I think it’s just sort of in a standstill while people wait to see what happens. I think God forbid we have another major storm sometime in the next 12 months that might alter the analysis cause then people think oh, this is not as a once in a very long time period but it might be the new norm as some people have been saying,” said Peter Reinhart, director of the Kislak Real Estate Institute at Monmouth University.

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Reinhart thinks many homeowners won’t walk away from their damaged properties.

“People that are at the Jersey Shore right at the shore, love the Jersey Shore and to the extent they can do so financially, I think they will hang in there and find a way to get it done,” Reinhart said.

Broker Susan Careatti of Avon-by-the-Sea Diane Turton Realtors gets a different impression from her storm-impacted sellers.

“Some of the property owners that have had tremendous impact on their properties, they are coming to us and say, ‘Should we rebuild, or should we sell as is at a decreased value?’ And you basically have to approach them and say, ‘Are you willing to take $300,000 for your land or do you want to invest $150,000 into it and maybe get $450,000?’ Most people, quite frankly, would rather take their loss and go,” Carreatti explained.

But Careatti says Sandy has attracted an influx of a new type of buyer to Monmouth County — buyers from Ocean County whose homes were damaged by the storm.

“They don’t want to deal with rebuilding. They cannot afford it. They don’t want to go through the hassle,” Careatti said.

The new buyers in the post-Sandy era have new concerns.

“Anything along any waterway, the first question we have now from clients is ‘are we in a flood zone?’ People didn’t care about that so much before. It would be an afterthought, but now that’s in the forefront of everyone’s mind,” Careatti said.

And another question on the forefront of people’s minds — when will the overall Jersey Shore real estate market shift?

“One thing that stops markets dead in their track is uncertainty and so when we finally get some more understanding as to just how much it is going to cost, just how high you have to build, am I in the V zone — those kind of questions — once those answers are there, then I think the market will move ahead,” Reinhart said.

And it’s those answers sellers and buyers are anxiously waiting for.