Ever since Hurricane Ian made landfall, reporters and financial analysts have spent a lot of time talking about homeowner’s insurance and flood insurance. There has been a lot of speculation about the impact of the storm on insurance rates. Thousands of properties around the state suffered damage in this storm, and not all of the damage would fall under the umbrella of standard homeowner’s insurance policies.
There will be many people buying, selling and repairing their homes around Florida in the upcoming months. That high volume of real estate activity can have an impact even on those not directly affected by the recent storm.
What do tropical storms and hurricanes mean for the overall real estate market across the state?
Storms may actually help bolster prices
When numerous properties suffer damage in a storm, the effect on the real estate market can be profound. Homeowners and investors may choose to list properties for sale at competitive prices because they don’t want to make the necessary repairs.
Property owners in areas not affected by the storm will often see a surge in demand in their area and will have the opportunity to charge premium prices for their homes. Those who do have good insurance coverage and who invest in the necessary repairs to their properties may see their home values increase significantly.
Although there are some communities where the number of closings that occur will drop and the home sale prices may also temporarily decline, major storms often have a net positive impact on the statewide real estate market.
Timing is key to savvy real estate decisions
Some people become so fixated on the short-term consequences of inclement weather that they fail to see the opportunities that later arise. Those who recognize that their neighborhood may see an increase in home value might start making some changes so that they can list their property in the near future. Those who would prefer to sell and move out of a neighborhood may have to take a long-term view of the process to avoid selling at a loss.
Making sense of the local real estate market will help those anticipating a residential real estate transaction in the next year or two.