Since Hurricane Katrina devastated New Orleans, the fate of the city s destroyed homes has received a great deal of publicity. Less in the spotlight, however, has been the process of normalizing the business of selling homes.
Brokers said that after two roller-coaster years, the housing market has settled down as most displaced families have by now returned and bought replacement homes. Yet brokers also say that Katrina-related problems persist.
After Katrina, the entire business of being a broker changed here, said Bruce Balfour, an agent with RE/MAX whose own home in the Lakeview neighborhood, several blocks from one of the levees, flooded. To be successful here, you ve got to be patient, and you ve got to be a bit like a detective.
The most obvious changes are to the Multiple Listing Service (MLS). Since Katrina, the section for remarks has become the longest and most important part of the document.
Since flood waters damaged 71.5 percent of the city s homes, according to the New Orleans Metropolitan Association of Realtors (NOMAR), attention has to be called to numerous concerns. Agents need to indicate how much water poured in, but it s also vital to note whether that flooding was freshwater or saltwater. The distinction is important because saltwater is corrosive to pipes and wiring, and can lead to tens of thousands of dollars more in repairs.
It s still common to have two homes that look alike and are right beside each other but one sells for $320,000 and the other sells for $40,000, said Frank Trapani, president of NOMAR. You need a thorough inspection report.
The remarks section is also where sellers list the details of insurance settlements. Buyers want to know whether a listed home has already received insurance money, or since thousands of lawsuits are pending whether payments remain disputed. Also, depending on the elevation, homes in different neighborhoods have different insurance rates.
As a broker, you have to have a heightened skepticism about neighborhoods and homes, said Arthur Sterbcow, president of Latter & Blum Realtors, the city s largest real estate agency. You can t just trust the seller; you have to get out in the neighborhood and ask people exactly what happened and understand the subtleties of the destruction in the neighborhood.
Compounding the difficulty of pricing homes is the challenge of tracking progress in upgrading the city s infrastructure. Questions persist about the eventual location of new fire stations, clinics and schools.
The days of being able to call a government agency and find out what s happening are over, said Trapani. There s still some confusion, mixed messages and uncertainties, which is why brokers really have to be on their game.
Still, the number of brokers working in New Orleans these days is up compared to the pre-Katrina market. In 2005, before the storm, there were about 4,300 brokers and agents in the city, according to NOMAR. These days, there are about 4,600.
Although many displaced real estate agents went elsewhere for post-Katrina work (14 states allowed certified agents from Louisiana to work in their states for one year), many newcomers dabbled in real estate to serve the returning residents who created a brief real estate bonanza.
Offices of real estate companies are also returning to damaged neighborhoods. After the storm, only four of Latter & Blum s 29 citywide offices were functional. By the end of 2007, the agency expects to have 30 offices up and running.
Brokers said their recovery will symbolically be complete this month, when NOMAR holds a ribbon-cutting ceremony for its new headquarters. Flooding had destroyed the association s longtime headquarters, along with important records. To prevent that from happening again, the new building sits atop 12-foot-high stilts.
After all we ve been through, there s more camaraderie between brokers now, said Trapani. Old competitors now look like old friends.