Hello All, just wondering what if anyone has thought about investing in some of the areas that were damaged from Hurricanes over the last year. As an example in Port Arthur Texas? Homes are definitely on sale right now, some have been repaired some are tore down to the studs. Has anyone considered investing in areas like this?
Warren Buffett has always states, 'When people are feerfull be greedy, and when people are greedy be feerfull'. Well... People are definitely feerfull in areas along the coast that have been ravaged by hurricanes and flooding. Thoughts?
@Cody Larsen - Yes. I thought about it. The challenge I had was that I didn't know the MSA well enough before hand, and didn't feel comfortable being a good enough judge if the area or specific neighborhoods would rebound. But, there is definitely opportunity. Some folks made a killing buying in New Orleans after Katrina and around 2009-2012.
I think about it often.
I’m a native Houstonian and many of my friends there flooded and are living with other friends or family while waiting for insurance money to arrive. The flood is still very real for many people.
The big question that I have is “Will people have forgotten about Harvey in a couple of year from now, or not?” My childhood neighborhood, Meyerland, is in a very desirable part of the city. But it’s in the flood zone and always will be. Homes valued at 1MM prior to the flood are now selling for a third of that. And there are blocks full of homes like that.
Will this blow over in a few years? Part of me says yes and that buying now could mean a big payoff. The other part of me says Harvey is way different than previous floods and to stay away.
I live in New Orleans currently. I have yet to buy my first property but one thing I'm paying a close eye on is whether the house flooded during Katrina. I figure that is the "worst case scenario" (although I'm well aware it could always get worse) and gives me an idea what to expect. Proper insurance will be a must as well, and keep in mind they were oftentimes not covering homes that flooded as it was due to the levees and not the storm.
I'm currently looking at investing in the Slidell area. One of the specific things I'm paying attention to is the flood zone. I pull up the current flood map from the parish website and check it against what the owner is claiming. I have no plans to purchase a "buy and hold" in an active flood zone.
I think that with the potential of storm/flood intensity increasing over the next several years/decades, it's a safer play to stay out of active flood zones for anything other than quick flips or wholesale properties.
This is just my opinion, but it's one that I've heard repeated back to me quite a bit, so I'd say to be cautions with your estimated ARV and check current comps sold after the flood occurrence.
@Ben Rothwell What you stated is completely incorrect about insurance. In New Orleans, those that had flood insurance got paid, those without were offered payouts from the government.
@Korey Ashton regardless if any potential property is in a flood zone or not, it would be wise to purchase flood insurance. Many, many homes not in flood zones have flooded in the recent past, including floods from named storms and rain events. If your near the coast, you get it to be protected. If your property is not in a flood zone, it would be very cheap (most likely less than $500 per year for non-owner occupant house).
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