by Cheryl Piccio, ABS-CBN News
HOUSTON, TX — As residents of the Houston area continue to rebuild their lives after flood waters damaged many of their homes, they also face a changing market for housing, causing some to rethink their plans.
As Hurricane Harvey made its way toward southeast Texas late last month, the housing market in Houston took a hard hit.
Data from the Houston Association of Realtors, or HAR, show a 25 percent drop in home sales in August.
Location is a primary factor in determining home prices. But experts say buyers in Houston are demanding to know if the property has ever flooded or not.
The Quia family planned to buy their new dream home. For three months, their search went well — until Harvey hit.
“We had already selected a new home, but then Harvey came and the subdivision we wanted got flooded during hurricane Harvey, so no we have to look all over place and start again. “
While waiting for their dream home, the Quia family now has to deal with rising rent – brought about by the shortage in liveable properties in Houston.
John Anthony is a local real estate professional who says the storm changed the housing market drastically.
“We went from having too many houses on the market to not enough,” he said. Even rental properties we are losing supply on that because people who have been affected are looking for a place to stay. “
The Houston housing market is expected to return to normal in about 8 months. Forcing many to evaluate their entire home purchase game plan. For those looking to sell in the flood-prone areas, the road to recovery will be much harder.
“The seller was living in his house for 30 years and it has never flooded. He put $40,000 worth of work into his house. Prior to Harvey it was selling around the $180,000 price range, now he had to let it go because it was flooded for about $75,000”
Real estate experts told BA that on average, a home that got flooded even just once, will be hit with a 20 to 30 percent discount in resale price.
For homes that got flooded two or three times, homeowners should expect to get close to the land value only. And for many, even rebuilding, is not a financially good decision.
HAR reports that the demand for temporary housing has also spiked after Harvey. Single-family home leases jumped 9.4 percent in August while the number of apartment leases jumped 17 percent.
With the Houston housing market struggling to recover over the next 6 to 8 months, flooded homeowners in Houston, especially those who are uninsured, have more problems than options.