Tropical Storm Harvey is probably going to make Houston housing more expensive. With tens of thousands of homes and apartments damaged or destroyed, a large number of displaced people are looking for a place to live, with a reduced supply to choose from.
Cindy Hamann, chairman of the Houston Association of Realtors, says the results are foreseeable. “Definitely there’s going to be a shortage [of] homes that are available for rent or for purchase,” she notes. “Supply and demand always typically raises the prices.”
As a result, houses on the market for under $200K will go fast. Hamann says the Houston-area housing market will be stabilizing over the next three to six months as flood-damaged homes are repaired and become available again. Hamann strongly recommends flood insurance.
Hamann says there are ways to avoid buying a flood-prone house. “Every homeowner that’s selling their home has to fill out what’s called a seller’s disclosure notice,” she points out. “That is disclosing anything that has happened to that property that they have knowledge about, especially flooding.” Other required disclosures include fire, unnatural death on the premises, and whether the house has been used as a meth lab.
“There’s a safeguard also,” Hamann continues. “If [a seller has] insurance proceeds from any previous flood, then there’s going to be a record of that.” As a result, failure to disclose can be found out. “If you don’t disclose,” she warns, “you could end up in legal [trouble] over that.”
Bottom line: Hamann sees Houston real estate prices going up as a result of Harvey, but not skyrocketing. She says the market should sort itself out within a few months in terms of what’s available and who’s buying. She says the customer base should remain unchanged, since she doesn’t expect large numbers of Houstonians to flee the area as a result of Harvey.