INVESTMENT STRATEGY: DISASTER AREAS
Disaster Investing INVESTING IN REAL ESTATE RECENTLY IMPACTED BY NATURAL DISASTERS IS A COMPLEX AND NUANCED ENDEAVOR THAT REQUIRES CAREFUL CONSIDERATION OF BOTH MORAL AND FINANCIAL FACTORS.
TAYLOR MILLER
T ornadoes, hurricanes, and disasters are unpredictable and difficult to prepare for as a property owner or investor. In the aftermath of a natural disaster, the landscape of real estate investing becomes fraught with moral and wildfires are realities that certain parts of the country face. These ethical considerations. On one hand, there’s the perception that investing in disaster-impacted properties is insensitive, driving locals from their homes and capitalizing on tragedy. On the other hand, there’s the perspective of community redevelopment, addressing housing shortages, and stimulating economic recovery. It is important to explore both sides of this moral dilemma.
Ethical considerations aside, there are substantial advantages to investing in recently devastated property, whether it be from hurricanes, tornadoes, or wildfires. The key is to focus on creating value for both the community and the investment. Investing in disaster-affected real estate evokes strong emotions and polarizing opinions. Locals often view it as insensitive and opportunistic, seeing investors swooping in to profit from their misfortune. When an investor develops a site with a larger, more luxurious residence, it can feel like the area is being gentrified to bring in “outsiders,” effectively removing the original character of the community. For those who have lost homes and livelihoods, the sight of investors acquiring damaged
properties can feel like a betrayal, which only exacerbates feelings of displacement and vulnerability.
COMMUNITY REDEVELOPMENT AND
ECONOMIC REVITALIZATION There’s another perspective to consider— one centered around community redevelopment and economic revitalization. Investors who engage in post-disaster real estate investments see themselves as catalysts for positive change, not opportunists. Even some locals can find themselves adopting this point of view. Would you rather live in an area riddled with damaged homes, looted businesses, and infrastructure that is hanging on by a thread or see those properties rehabilitated?
32 | think realty magazine :: july - august 2024
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