Soggy New Orleans runs out of places to

Soggy New Orleans runs out of places to live Michael Giusti / bankrate. com http: //www. detroitnews. com/apps/pbcs. dll/article? AID=/20060113/BIZ 03/601130323

Housing Supply in the Big Easy • Real estate markets across the United States are hot, cold or lukewarm. In hurricane-ravaged New Orleans it's just a soggy mess. • Not that it's all bad. The market in the Crescent City has a new golden rule: If your house didn't flood, has electricity and is in an area with a viable schools system, it's gold. • That new landscape has sparked something of a gold rush, prompting people to quickly buy up any reasonably priced house on the market, says Arthur Sterbcow, CEO of Latter & Blum Inc. , one of the region's largest real estate brokerages. • "We are in one of the most active markets I have ever experienced. It is both the best and worst of times -it just really depends on what side of the (17 th Street) canal you were sitting on when the levees broke, " he says.

Where New Orleans Flooded http: //homepage. ntlworld. com/c. mcmahon 4/nola/maps. htm

Half of the Housing Uninhabitable • While Hurricane Katrina destroyed or damaged entire neighborhoods throughout the metro area, many more were left standing and in relatively good shape. • The storm rendered about 267, 000 of the metro area's 565, 000 homes uninhabitable. As hordes of evacuees now make their way back into the city, demand for a place to live is growing every day. • Independent levee systems run along each side of the 17 th Street Outfall Canal. Following the storm, the Jefferson Parish side remained intact, sparing at least half of the metro area's homes from storm surge flooding. • But even on the New Orleans side, not all homes flooded. Several areas of the centuries-old city were built on relatively high ground. Higher areas tend to be the older, historic areas along the Mississippi River that were built before modern technology allowed the swampland that much of the city sits in to be reclaimed.

Help on the Way? • With so many residents fighting to get back to their jobs, family and lives, the city is just plain out of places to live. • No help appears to on the way, either. With nowhere to live, the army of construction workers needed to rebuild the city also has nowhere to stay. Contractors from around the nation, trying to converge on the largest current construction project in the world, now are functionally locked out of the market. • The shortage of workers has boosted labor prices for the laborers who have been able to find somewhere to live. Unskilled laborers are earning as much as $20 and $30 per hour, where they were making a third of that before the storm. • Real estate investors are also affected. With a shortage of workers, there is nobody available to rapidly repair "fixer uppers, " which makes quickly reselling properties nearly out of the question, Sterbcow says.

The Economics Housing Market Price Labor Market S Wage S w 1 P 0 D w 0 D Q 0 Housing Quantity L 0 Labor Quantity