| New Orleans real estate: a mushy
gold rush |
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All wet
While the dry properties are selling fast, owners of homes within
the flooded areas are mostly waiting to see what will happen with
the city and the levees before investing the time and money to rebuild.
Regardless of what the politicians decide, homeowners
in many of the areas of the city will be forced to either completely
rebuild their homes or knock them down and start from scratch.
This is because entire neighborhoods were submerged
for weeks in brackish water, infesting the homes with mold and corroding
everything from wires to plumbing and even the nails holding the
homes together.
With so much internal corrosion, a simple cosmetic
fix is out of the question.
While a few investors are buying homes at fire-sale
prices when owners just want to cut their losses and leave the mess
for someone else to pick up, the majority of owners are waiting
and watching the politicians before they decide to invest the time
and money to rebuild.
Two issues are hindering the market, Sterbcow says.
First, is that most homeowners want a commitment from
the federal government that it is going to expand the levees to
a level where they could withstand another major hurricane.
The other issue is that homeowners want assurances
that if they rebuild their home the city won't come in behind them
with new regulations -- such as a change in zoning or elevation
requirements, rendering their repairs a waste.
The city and the state both have rebuild committees
working on recommendations about how the city should be rebuilt
or whether some flood-prone areas should be left vacant.
And then there is the issue of a possible federal
or state buyout of the most damaged areas. One bill moving through
Congress sponsored by Rep. Richard Baker, R-La., would establish
the Louisiana Recovery Corp. That federally backed organization
would allow homeowners to sell their damaged property to the group
without losing their equity. The Recovery Corp. would then redevelop
the property and resell it at a profit.
As for some of the worst-hit neighborhoods, such as
the Lower 9th Ward and Chalmette, officials are having trouble even
restoring the most basic services.
According to city of New Orleans statistics, 23 percent
of the city still has no access to electricity, 25 percent has no
access to natural gas, and entire ZIP codes still have no water
or sewer service.
"It's such a screwy market that it is real tough
to get your arms around," Sterbcow says.
Michael Giusti is a freelance writer
in New Orleans
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