In the Aftermath of Superstorm Sandy, Staten Island Real Estate Boom Offers Potential Opportunities for Investors
You probably remember the news broadcasts of the heart-wrenching scene after “Superstorm Sandy” in 2012—uprooted trees, floating cars, and crushed homes. Many houses were gutted by the storm, with floors, walls, and ceilings blown clear off. The damage totaled $64 billion. Some residents simply fled, leaving their homes with food still in the cupboards and toiletries in the bathrooms. In the subsequent years, afflicted Staten Island homeowners struggled to either press their insurance or governmental agencies to help them afford repairs or find a buyer for their damaged property, which became an opportunity for investors to aid a grief-stricken community by rebuilding.
With the widespread need for salvaging homes, otherwise unaffordable properties came within reach of investors—and interest continues to grow. Of course, it took a couple of years for both residents and investors to sort out how to move forward with their transactions in the midst of the flurry of new governmental programs and requirements. As a result, the initial rebuilding process was ongoing, even three years after the storm. In addition, the increasing development activity took place unevenly across the island, primarily focusing on acquiring properties on the waterfront in the Clifton, St. George, Stapleton, and Tompkinsville neighborhoods of the North Shore.
As the Sandy Situation Evolved, So Did the Market
2015 seemed to be a turning point with the beginning of major developments, including a $350 million shopping mall and entertainment complex, a 630-foot Ferris wheel, and numerous large-scale apartment buildings meant to attract younger professionals. To build on the momentum, the mayor also launched a massive affordable housing construction campaign. By May of the following year, the state also completed a series of residential property auctions, selling 417 storm-damaged homes at deeply reduced prices with the aim of restoring neighborhoods. As a result, even more real estate investors took advantage of the favorable economic conditions, new policy climate, and growing interest in Staten Island to buy and refurbish older homes.
But, amidst all this new investor activity and development, there remains plenty of opportunity to purchase inexpensive homes that still need rehabilitation. As of January, the pre-foreclosure rate had increased by 16.2% from the prior year and 34.4% from the previous month. In fact, foreclosure activity remains higher than the national average, with most occurring in the zip codes that have significant water frontage. These are prime areas for obtaining investment properties that need some love and care to be re-sold at market value.
The Staten Island Market Offers Both Price and Position
Purchasing a foreclosure looks even better since four and a half years after the devastation of Hurricane Sandy, Staten Island may be again poised for long-term growth. Since the storm, the median listing price of homes has increased steadily, from $374,000 in 2013 to a three-year high of $514,000 in January of this year. That represents year-over-year growth of over 20%! With the spring real estate season coming, many are saying that 2017 will continue to be a seller’s market as a result of continuing low inventory.
Even more, Staten Island continues to attract new residents as the area features some unique attributes—making it a prime pick for investors:
- It’s just a boat or ferry ride away from the four other boroughs and the Staten Island Ferry delivers passengers to Lower Manhattan. Few locations have such convenient access to one of the world’s most thriving business districts—a fact that makes Staten Island very popular amongst commuters.
- Staten Island feels more suburbanthan many other regions of the Big Apple and this makes it appealing to buyers seeking a less urban atmosphere. Some areas of the island feel a world away from the hustle and bustle of the more urban regions of Manhattan.
- A unique and youthful culture has been cultivated, with new developments aimed at attracting younger professionals.
- Relative affordabilitycontinues to attract buyers priced out of neighboring boroughs. The median home value in Staten Island as of March 2017 was $454,200, while the New York City median price is $631,300. These lower than average prices make this borough very sought-after amongst potential buyers.
Staten Island’s particular real estate market conditions created by Superstorm Sandy have made this borough a prime location for investors. And its ideal location, combined with a distinctly suburban feel in many areas, means the island’s real estate values may continue its current growth trajectory.
Finding the Right Investment Property is Key
In order to take advantage of opportunities like those in Staten Island, you will need to be able to pinpoint the properties that offer the best potential return on investment. HomeVestors® provides each franchisee with access to resources and tools, including a proprietary property evaluation system, to help identify distressed properties—often even before the property goes into foreclosure. If you’re interested in having the support and security of a proven investment strategy in place by becoming a HomeVestors® franchisee, contact us at 888-988-0575 or click here to request more information.
Each franchise office is independently owned and operated.
Image Source | FEMA.gov