Experts provide opinions about flood impact on real estate market

Posted by Tom Kalinski Founder RE/MAX of Boulder on Tuesday, October 15th, 2013 at 4:17pm.

It’s too soon to tell what exactly the impact of the recent flood will have on the Boulder-area markets. But, from past experience with other natural, widespread disasters such as wildfires, experts are able to make an educated guess.

Following discussions with professionals in Boulder and surrounding areas the flood most affected, Realtor Kelly Moye relayed to 9NEWS what their thoughts are on how the flood will impact the local real estate market.

  • Inventory has already been an issue for the Boulder-area market for about 18 months now, but it dropped another 33 percent, which Moye attributed to water damage.

 

  • Floodplain maps are likely to see significant changes based on the extent of flooding and the new routes of Colorado’s rivers. This will require additional homeowners to purchase flood insurance. It’s unclear how that will affect home values, but historically it’s not expected to have much effect, especially in Boulder.

 

  • The rental market has picked up as displaced homeowners have to find temporary accommodations, and investors are taking advantage of the opportunity.

 

  • Buyers undecided on whether to buy a house or a condominium in Boulder apparently are leaning toward buying a condo now.

 

  • Properties in the floodplain hit the hardest are most likely to take a hit, although those were more likely to have flood insurance and are able to remodel or rebuild if they are able to make it through this initial, critical time. But it’s the homes that weren’t in the floodplain but affected the hardest by the flood are expected to suffer the most, especially those in investor-owned areas (such as many homes in Martin acres, a more affordable neighborhood in Boulder, among others) or without the equity to rebuild.

 

  • Boulder and Weld counties are requiring appraisers to perform re-inspections, causing delays in closings and sometimes loss of interest rate locks for buyers.

As with other natural disasters, the damage done by the flood could affect property values for a minimum of a year, Moye reports. The lending on properties – even those unaffected in the county – has become more difficult. And the flood will force homeowners to rebuild and remodel, which could improve neighborhoods and home values.

Source: 9NEWS

Tom Kalinski 
Owner and Founder
RE/MAX of Boulder
303-441-5620
tomkalinski33@gmail.com

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