Harvey is estimated to have caused $150 to $200 billion of damage as of September 9, 2017. The first damage loss estimates were about $50 billion.
But who will benefit and who will be hurt?
Answering that question is our objective.
Houston GDP
Texas gross domestic product (GDP) is estimated to be $1.6 trillion per year. Houston GDP is about 30% of Texas GDP, or about $0.48 trillion, or about $480 billion. Spending $50 to 100 billion on real estate repairs and purchases of new cars generates an increase of about 10 to 20% of GDP for Houston.
Winners
Construction workers and businesses, apartment owners, office building owners, suppliers of construction material, will all benefit from Harvey. There will be billions of dollars of construction work; so much construction workers will be in Houston for a year or more. Those displaced by Harvey will help absorb tens of thousands of houses and apartments.
Houston Housing Market
The single family market is tight with only 3.7% of inventory available for lease or sale as of late July. There is now just over four months of inventory available for sale in Houston. It is a healthy home market with low appreciation, two to five percent. However, the apartment market is about thirteen percent vacant. There are about vacant 86,000 apartments and about 49,100 houses available for sale or lease, for a total of 135,100 housing units available.
Harvey flooded 119,000 houses in Harris County, or about 13% of all houses, versus 55,000 houses flooded by Allison. Harvey caused 216 percent the number of houses flooded, compared to Allison. The guest workers from out of town to help with repairs will further stress the limited amount of housing available, including hotels and motels and shelters.
Millions of square feet of office space will be absorbed from companies displaced by Harvey. Office space is more than twenty percent vacant. However, this is just a short term benefit.
However, the cost to rebuild housing and commercial real estate will be substantial, perhaps $100 billion.
Who Will Lose?
Likely half a million to a million people have been impacted by Harvey. The number of those negatively affected by Harvey is much larger than the number of those who benefit. This includes those whose house flooded, business flooded or car flooded. Those most tragically affected include those least able to incur a loss or hardship. They have no reserves and losing everything literally means losing everything.
It includes people living in apartments and homes that flooded; owners of businesses that flooded; those not paid during days off, owners of cars flooded. Those tragically affecting includes everyone whose house, business car flooded and more. Employees of companies flooded may not be paid while the business is shut. Many small businesses will not be able to recover from Harvey. In addition to the initial flood, many home owners and business owners flooded by Harvey did NOT have flood insurance. Only 20 percent of those flooded are estimated to have flood insurance. Our office was flooded by Allison. Our office was flooded by Harvey. There are financial, emotional and physical aspects to the stress of flooding. The human toll of having been flooded is difficult to explain. However, it is intense and dramatic.
P.S. I had office buildings on 2 continents flood within one week in August.
Just the emotional harm to the entire area is devastating. We lived in Galveston during Hurricane Ike and had a high level of damage to both house and personal items! The one thing that we noticed the most was the stricken look on the faces of everyone – even if they hadn’t incurred great losses!! This sort of thing is emotionslly draining and it takes months, if not years, to come back from it. We have since moved from Galveston!
My daughter (a renter)lived in Harris county at the time of the flood. She worked from home and lost all of her personal property. She is still currently displaced due to the financial aspects of her loss. She is young and just starting out her career, but she is working hard to recover. Unfortunately, she did not qualify for FEMA personal property. They have referred her to SBA for a loan to cover her losses. This hardship has affected so many people and is so frustrating seeing it first hand. I really hope the business that benefit from Harvey don’t take advantage of the people who have this hardship.
Thank you
I was devastated because of Hurricane Harvey. L
Hurricane Harvey caught me of guard and Fima gave me money to restore my home with sheet rock,flooring,doors,vanities, appliances, furniture (living room set,3 bedroom set, washer & dryer, clothing. Well as much as I appreciate the $15.000.00 it won’t pay for the labor or paying for all of my appliances,furniture and clothing. I under stand that there have been billions of dollars donated to Harvey victims but where has it gone it’s so many of us I devastated from the storm and still need help but where have all the donations gone I don’t think the majority of us have seen any of it.
Hurricane Harvey caught me of guard and FEMA gave me money to restore my home with sheet rock,flooring,doors,vanities, appliances, furniture (living room set,3 bedroom set, washer & dryer, clothing. Well as much as I appreciate the $15.000.00 it won’t pay for the labor or paying for all of my appliances,furniture and clothing. I under stand that there have been billions of dollars donated to Harvey victims but where has it gone it’s so many of us I devastated from the storm and still need help but where have all the donations gone I don’t think the majority of us have seen any of it.
Hurricane Harvey caught me of guard and FEMA gave me money to restore my home with sheet rock,flooring,doors,vanities, appliances, furniture (living room set,3 bedroom set, washer & dryer, clothing. Well as much as I appreciate the $15.000.00 it won’t pay for the labor or paying for all of my appliances,furniture and clothing. I under stand that there have been billions of dollars donated to Harvey victims but where has it gone it’s so many of us are devastated from the storm and still need help but where have all the donations gone? I don’t think the majority of us have seen any of it.
People in Port Arthur,Texas still need financial help with restoring their homes back to what it once was.