Saturday, June 12, 2010

Silent Death - The Gulf Oil Spill Effect No One is Talking About...

As I watched the major TV News Networks discuss the tragedy of the British Petroleum Oil Spill in the Gulf of Mexico, something dawned on me - The Residential Real Estate market in the Gulf States is toast for at least 10 to 15 years...

According to Wikipedia, there remains 26,000 gallons of crude in the sand and soil from the Exxon Valdez Oil Spill from 1989. That was more than 20 Years Ago !!

I have heard estimates in the news that the BP Oil Spill in the Gulf is more than 8 times larger than the Exxon Valdez spill, so is it going to take 8
times as long for the Gulf to recover to the level that Alaska is today? As large globs of oil wash ashore on the beaches along the Gulf Coast, and news spreads about the dangers of the dispersants used to clean up the oil - the question remains: Will people want to buy condos or vacation properties along the Gulf, knowing the dangers to themselves and their families ?

The commercial property owners along the Gulf Coast States have already begun assessing the effects of the spill on their businesses. Sure, in the immediate term, not many people will want to rent hotels or condos and vacation in the Gulf.

But how long will it be until people actually want to purchase vacation properties there? Current Gulf Coast property owners are concerned about loss of value, and are looking for compensation from insurers or BP. But that's a short term solution to the problem at hand. The long term, and unknown effect - will show it's ugly head when it's time to sell. Sellers could be hit with Short Sale like prices long after the rest of the country has recovered from the current real estate/economic crisis.

We could be looking at the Death of Gulf Coast Residential Real Estate for at least a decade or more...

Deepwater Horizon Oil Spill (BP Oil Spill)
from space by NASA's Terra Satellite

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