Real estate sales boom, despite flood insurance crisis
Congressional action on Biggert-Waters credited with relieving homebuyers’ anxiety
Kyle Barnett - Jun 27, 2013
Despite the negative effect the uncertainty over impending flood insurance rates is having on some areas of St. Charles Parish’s real estate market, the overall outlook is good according to local realtors and government officials.
After a long dip in home sales and values since the mortgage bust in 2008, reports are coming in that the real estate market has finally climbed back nationally.
St. Charles Parish Assessor Tab Troxler said the local market is also on the rise.
"I think our market is following the national trend - it’s recovering," he said.
According to data provided by Gulf South Real Estate Information Network, the average time homes have been spending on the market on the West Bank since January is only 51 days and on the East Bank it is 83 days.
Regina Allemand, a realtor with Gardner Realtors, said she has definitely noticed more homes being sold.
"We’re definitely doing well despite the flood map issues. Things have been selling," she said.
Allemand has also noticed a younger first-time buyer crowd picking up homes, some of whom are even as young as 20 years old.
"I’ve had several clients recently that are in the 22 to 23 years old age group. They are fresh out of college and have good jobs and it is cheaper to buy than it is to rent and I can’t say I blame them," she said. "These are people my son’s age so I am nervous for them. Their parents say ‘you better take care of them!’’’
After being named the top seller in the River Parishes last year, Dawn Morales, with Boutte-based Latter & Blum Realtors, is already set to eclipse her 2012 sales figures within the first half of 2013.
"I am listing and moving them really quick," she said. "This year I thought it seemed to be the same, but I didn’t realize how well I was doing until I sat down and talked to my manager about it."
Morales places the bounce back in the market on historically low interest rates. She said the fact that interest rates are now increasing may be driving some people to go ahead and purchase homes before rates rise too much higher.
"Interest rates are starting to increase a little bit and I don’t know if people are making that move to go ahead and buy because of that. It was at 3.25 percent and now it is closer to 4 percent and people are definitely buying," Morales said.
Things seem to be picking up as well for parts of the West Bank that may be facing very high insurance rates under new FEMA maps and the Biggert-Waters Act. After a few months of no home sales at all in the Sunset Drainage District, Troxler said a home was recently sold in the area.
"We did have one sale on Mark Drive in Bayou Gauche," he said.
Though sales are on the rise now, Allemand said some of her customers backed out of the real estate market completely after a FEMA town hall meeting in March. At that meeting, some residents were told by FEMA that they would have to pay tens of thousands of dollars per year to insure their homes.
"I had a few sales fall through because of the fear of flood insurance premiums being higher," she said.
Morales said she also experienced problems immediately after the FEMA town hall meeting.
"I had a contract on a house and it was supposed to close two weeks after FEMA came here and the buyers cancelled the contract," she said. "I also had a listing that was pulled off the market because of all the bad publicity."
The recent news of the lobbying of Congress on behalf of the parish and FEMA’s motions to decrease the flood insurance rates have been a good sign to those in the market to buy homes.
"With the most recent information on the flood insurance program people are taking a more positive look. They realize it isn’t going to be as bad as what they first thought," Morales said. "The good news coming out lately about FEMA maybe recognizing the (Sunset Drainage District) levee has also been good."
Allemand said she has started to get more buyers interested in looking at homes in areas that have been designated for higher insurance rates. She says some homeowners in those areas also feel they now have a chance at selling their homes.
"Just remember what I said when all of this first came out - don’t panic, this is going to work itself out," she said.
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