According to a new report, the oil spill will negatively affect Gulf Coast real estate values by $3 billion over the next five years. The report by CoreLogic of California says the average loss per home in the Mobile, Alabama coastal areas will be $45,000.
According to the report, the hardest hit area will be Gulfport, Miss. with an average loss of $56,000 per beachfront home. The loss in Pensacola is quoted at $40,000 per home.
CoreLogic is headquartered in Santa Ana, Cal. and claims to have “the most comprehensive business database in the U.S.”
Locally, Dr. Don Epley scoffs at such out-of-state “experts.” Epley heads the Center for Real Estate Studies at the University of South Alabama in Mobile.
“It’s too early. We don’t yet have the data,” says Epley. In a recent presentation, Dr. Epley said that it appears from limited preliminary data that one category and location of real estate may be down by about 19 percednt while another category/location may actually be up by approximately 20 percent. Epley declined to identify the categories and locations, promising a full report as hard data is collected and analyzed.
Bob Shallow of ReMax in Gulf Shores says he has had the best June and July sales in three years. “In the first several weeks after the spill, it was dead. But now things are moving,” he said.
“I’m not speaking of values,” he explains “but in reference to total volume of sales.” Shallow has been ranked for several years as one of the nation’s top volume ReMax sales agents.
“The truth as to values will be in the numbers which we will have pretty quickly,” he says. “But people are coming out of the woodwork looking for deals. I have a steady stream of buyers now, where three years ago I couldn’t sell anything.”
Maybe because Dauphin Island is more isolated than Gulf Shores, the outlook there appears to be less optimistic. According to John Hopkins of Anchor Real Estate on Dauphin Island, “Things are just terrible down here. It’s just a mess, one big mess.”
Hopkins says nobody can get to the beach. “There are 20-oot mounds running along the beach that were built to contain the oil but are now blocking access to the beach.” He says he would estimate that the oil spill has hurt real estate values by about 30 percent.
Hopkins has been selling real estate on Dauphin Island for 10 years. “We usually sell between $6 to 10 million a year,” he said. “So far this year we haven’t done a half million.”