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Louisiana
Nearing three years after Hurricane Katrina devastated parts of Louisiana, real estate has slowed and rebuilding in New Orleans is moving at a snails pace troubled by government red tape and political issues.
A flurry of housing sales boosted the New Orleans market a year after the storm and things looked promising, but as three years approach less than half of the city’s residents have returned. Destroyed uninhabited neighborhoods lay in ruin and a sad state of affairs exists in much of the Big Easy.
New Orleans housing sales have slowed. New home starts, however, are expected to increase in 2008 as the city rebuilds boosted by a move by actor Brad Pitt, who started a program to aid New Orleans from the ruins.
The New Orleans economy is getting lots of federal assistance. The Redevelopment Authority will get an estimated 7,000 homes to buy out in the next year and a half. More than 300,000 homes, however, were destroyed along the Gulf Coast from the furry of Katrina, many tens of thousands of them in New Orleans.
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| City |
Forecast |
| Baton Rouge |
− 7.9% |
| New Orleans |
− 6.8% |
| Lafayette |
− 2.8% |
| Alexandria |
− 3.9% |
| Monroe |
− 2.1% |
In the wake of Katrina, New Orleans still has a housing shortage. About half of all the residents in New Orleans before the storm were renters and many say they would like to return but are unable to find housing. As a result of slower sales and slow government handling of the devastation Housing Predictor expects home sales to remain slow through 2008, which will account for further devaluation in average home prices at 6.8%.
In Baton Rouge the housing market boomed after Katrina, accounting double digit appreciation in one year, but has since stalled. Home prices became too high for many to qualify for and the credit crisis hit to sweep through the market.
Baton Rouge will have another year of slower sales as a direct result of the fall out with housing deflation forecast at 7.9% for the year.
In Lafayette it’s quite a different story than most of Louisiana. Homes sales are up from the previous year, but are failing to keep in step on a monthly basis. However, Lafayette has one of the lowest unemployment rates in the state hovering around 2.0%, which should help the home market.
Job creation will result in home sales through the year at a healthy pace, but lower sales volume will lead to a net loss in average values forecast at a lower 2.8%.
In northern Louisiana the Monroe housing market boomed after Katrina with construction of new homes. But as the credit crunch hit the nation home starts fell off with lack of mortgage money availability.
Monroe will see slower housing sales in 2008 as a result, which will net the first decline in prices in some time at a modest average of 2.1%.
In Alexandria, real estate sales will also be slower in a slow down that resembles the way things are in the south. Southerners like it just fine that way most of the time especially since the south is seeing enormous growth and a large infusion of federal money will restore the infrastructure in Louisiana in the coming decade.
The housing market in Alexandria will see a forecast drop off in homes sales in 2008 on the way to a decline in average values of 3.9%.
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