After the Storm; Part 6 of 6

Nuggets For The Noggin

After the Storm; Part 6

Article by: Jim “Gymbeaux” Brown, October 6, 2005

This Nugget was drafted in hopes of preparing others for what happened AFTER Katrina hit the Slidell, Louisiana area.  Some of the below items were to be expected while others came as a complete surprise.

I am not sure who said it but believe it was Zig Ziglar, “Money tends to exaggerate that what we already are!”  By this he meant that if you are caring and compassionate, with additional money in your life you become even more caring and compassionate.  But if you are a greedy SOB, you simply become an even greedier SOB.

If one thing was evident after Katrina, this theory has been proven to be correct.  Here are some of the things that have occurred since Katrina:

• If there were Purchase Agreements in effect BEFORE Katrina and the home survived, Sellers were trying to find ways to cancel the contract, put the home back on the market because they “felt” their homes were worth more than before Katrina.
• Purchasers were writing Purchase Agreements that included a contingency that the repairs were to be made by the Seller prior to the Act of Sale which Sellers agreed to do.  Then during the home inspection process they change their mind with the false belief that they don’t have to make repairs because if THIS buyer does not want the home “as is” there are plenty of buyers who are desperate enough to take it “as is” and probably pay more to do so.
• Real estate agents who prior to Katrina were admired and respected are now hanging up on people, threatening everyone with law suits and have become a general pain in the neck.
• Buyers and sellers are constantly threatening law suites when contract negotiations do not go their way.
• Some sellers are accepting offers for less money because the purchaser has a horror story as to what has happened to them and then a second purchaser who offered more gets upset because they did not get the property.
• Multiple offers abound so if your procedures on handling multiple offers are not in place and everyone understands how to work them, it will only lead to serious legal problems.
• Everyone wants rental properties and if you are in an area such as Slidell where under normal conditions there are not a lot of rental properties, this becomes a nightmare.
• Sellers think their home is now worth $20,000, $30,000 to $90,000 more than pre-Katrina prices.  Appraisers are under close scrutiny by the Federal Government NOT to let all cash sales influence their appraisal process.  Therefore the all-cash sales will not influence property values until there are sufficient numbers of cash sales where a trend can be establish.  So over the long term prices may increase but in the short term they will only increase very gradually.
• Patience is a rare commodity on the part of everyone, buyers, sellers, agents and even Keller Williams' Realty associates.
• Depression will set in, not if, when.  You need to know this is going to happen and be ready for it.  Traffic is a nightmare.  Slidell still has residents that have not as yet returned even after one month yet the population of our city must be at least double because of all the support workers and people that have come here to stay because their homes in other areas were destroyed.  There are lines to wait in no matter where you go.
• If your home and business survived while so many others have been devastated, guilt creeps into your thought process, why was I spared?
• The 80/20 Rule still applies but in reverse.  About 80% of the people accept what happened and what continues to happen and do their best to get into recovery.  The remaining 20% are impatient, rude, do what they can to get what they want when they want it and have little regard for anyone else.

This is a slice of life AFTER Hurricanes Katrina and Rita.  I don’t want to paint an ugly picture because with every day there is one less pile of rubble and another business opening.  Our phones have been ringing off the hook.  Two, three and four calls coming in at the same time – that is a good thing if you can answer them all.  The real estate market, in my opinion, will be very good for some time to come.  Yes there will be shortages but the market is definitely changing.  Prices in this area have been low as compared to other parts of the country and they will most assuredly begin to rise.  There will be tremendous development and repair work ongoing for one or two years (2013 update, turned out to be years and years).  So all things are not all bad.  People are talking to people that they otherwise would not have talked to – that is a good thing.  People are helping people who before Katrina they did not even know. 

I close this Nugget with a true story.  My Call Coordinator was sitting in a line of traffic trying to get off the Interstate and get to work.  This in itself is an ordeal because it could take up to 30 minutes to get off the Interstate.  She noticed two men walking along side the off ramp; one had no shoes and was obviously in pain trying to walk on stones and everything else you see along the side of the roadways of America.  The car in front of her stopped and the driver got out, opened his trunk and handed the fellow a pair of tennis shoes.  The man began to cry on the spot.   A month ago this would not have happened.

Life has changed in Slidell and it will never be quite the same ever again.  In a great many regards, this is a very good change.  And by the way, during the next storm, there are 7 less trees to fall on my home!  And, that is a very good thing!  And if you want even more good news, there are probably a hundred less trees to get in the way of my golf ball and that is FABULOUS NEWS!