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Real Estate - Residential

Storm Squeezes Area Rental Market

By Cece Nunn, posted Oct 5, 2018
A rental market that was already tight before Hurricane Florence made landfall near Wrightsville Beach on Sept. 14 has been bogged down in the aftermath of a storm that not only destroyed homes in the region but also damaged some to the point where residents have to relocate.
 
“In the short term, the loss of rental properties and damage to owner-occupied homes to storm damage will create an extreme shortage of available rental properties,” said Dave Sweyer, owner of Sweyer Property Management, in an email Sept. 27. “The area was already at full occupancy coming out of the summer season. For example, Sweyer Property Management has had over 96 percent occupancy [in 1,600 properties] for several years in a row. The impact of Hurricane Florence will be an increased demand for rental properties and fewer rental properties available.”
 
Those two factors will lead to a higher-than-expected increase in rental prices, he said.
 
“Over the long term, from a rental property perspective, I think it will take 12 to 18 months to recover, as the properties are repaired and new investments properties are built,” Sweyer said.
 
Community groups, state and local governments and companies with employees who are displaced have been helping people find places to live.
 
Coldwell Banker Sea Coast Advantage has assisted Sea Coast agents and staff members, along with others who aren’t employees, find temporary housing, and Sea Coast Rentals is working on a Rental Relief Network, hoping to urge property owners with second homes or homes on the market that haven’t sold to list those as rentals, said Justin Ash, president of Sea Coast Rentals.
 
“We’re going to basically say we’ll manage it for reduced costs and we’ll do it for as long as there is a tenant in place, but these people really need your properties and need your help,” Ash said. “We’re trying to create this network of people to give them an avenue to help out, at least for the short term if not the long term.”
 
On Sept. 19, the Wilmington Chamber of Commerce sent out an announcement to members stating,
 
“The New Hanover County Emergency Management Office is in need of long-term housing for displaced residents and emergency crews due to Hurricane Florence.”
 
Natalie English, chamber president and CEO, said in an email Sept. 27, “We are having success identifying available properties although the need is great.”
 
That need in the wake of Hurricane Florence involves those who lost homes or are displaced by damage but can’t afford to rent and will need government assistance of some form; those who are displaced but can afford to rent; those who have traveled to the Wilmington area to help in the recovery from private businesses; and those in town to aid in relief efforts.
 
“I’m still hopeful we will have the capacity. My concern grows, however, when you begin to include our surrounding counties,” English said. “Pender County, in particular, continues to face the loss of habitable living spaces. Housing the entire region is going to be very challenging.”
 
Of the relief and recovery workers who have come to the area from all over the country, English said hotels and short-term rentals are mostly booked.
 
“When new people want to come help, they are hard-pressed to find a place to stay. That is a contributing factor to the challenges of the first two groups [mentioned above],” English said. “We remain hopeful that the short-term rental market at our beaches might provide a source of longer-term housing for people displaced from their homes. Realtors in our area have stepped up to help catalog that availability.”
 
Ash said it’s illegal for landlords to restrict the usage of their properties to only those who were displaced by the storm.
 
Meanwhile, thousands of structures are total losses in Pender and Brunswick counties, with an anticipated smaller number of units destroyed in New Hanover County. And some of the structures are rental housing, meaning homeowners aren’t the only ones facing the issue.
 
“I don’t think Wilmington/New Hanover will have the rental property capacity to handle all of the people displaced by the storm. Current tenants of properties should be very patient with their landlord and the time and effort needed to return the property to its normal condition,” Sweyer said. “If a tenant leaves their existing property, they are potentially going to encounter a difficult time finding a new rental property, and I anticipate that rental property rents are going to go up quickly during this recovery period.”
 
His advice for renters: “Tenants should try to work out arrangements with their landlord so they can return to the property when repairs have been completed or accommodate the repair process while they are still living there.”
 
While FEMA is a resource, the federal agency can’t tell people what to do when it comes to where they can live if they’ve lost their houses or their homes are no longer inhabitable, said FEMA spokesman Darrell Habisch.
 
“Each case is individual, and we try to work with those individuals to help solve their problem,” he said. “Often we work with the whole community whether that’s volunteer organizations, the Red Cross; it might be shelters that are being operated because everybody needs a safe, secure, sanitary place to live.”
 
FEMA also works with state and local officials. He said manufactured housing is only put in place as a last resort.
 
“It is difficult to find approved and appropriate locations to put them,” Habisch said.
 
FEMA aims to help people with their immediate needs “and make sure that if they have major damage to their homes and apartments, register. We want you to register with FEMA, and let’s take a look at what may be available to you,” Habisch said. “That may also include the Small Business Administration loans for individuals, not just businesses. These low-interest loans are available to individuals so they can rebuild their homes and lives.”


 
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