At the end of last year, Puerto Rico suffered a devastating hurricane, which some estimates say killed as many as 5,000, and left the island without power for weeks.
Now, Americans are moving in on the island, capitalizing on the downward trend in real estate prices due to the storm. After Hurricane Maria hit the island, homes saw their values decrease by an average 15%, according to a new study from Point2 Homes.
The study shows that Americans’ interest in the island’s real estate is on the rise and online searches for homes for sale even peaked during the storm’s impact. In fact, the survey conducted by Point2 Homes shows potential U.S. homebuyers are looking to purchase homes on the island within a year.
Hurricane Maria caused an estimated $90 billion in damages, with housing receiving the largest portion of the destruction at $37 billion. More than 470,000 properties were hit by the storm, of which about 20% were completely destroyed.
But while home prices dropped 15% after the storm hit, it is hardly a new phenomenon on the island and was only exaggerated by the storm. Even before the storm hit, about 16,000 residents were facing foreclosures.
And due to the island’s ongoing 10-year economic recession, median home prices had already fallen since the housing bubble burst in 2008. Currently, home prices stand at about half of what they were before the recession.
Over the past eight years, the median home sales price dropped 48% from $224,000 in 2010 to $116,750 in 2018. Right before Hurricane Maria hit the island, home prices were about 15% higher at a median $136,500.
Now, as home prices continue to fall, Americans are growing more interested in buying real estate on the island. And while some of the traffic could be less serious lookers or those who are just curious, a majority of Americans said they are seriously interested in buying a home in Puerto Rico.
A survey by Point2 Homes of 435 of its site’s visitors showed 60% of views said they were seriously interested in buying property in Puerto Rico. Another 34% answered they were just trying to get a feel for the prices, and 6% said they’re looking to sell their home on the island.
As far as time frame, those looking to buy within the next six months saw the highest percentage of lookers at 29%, followed by 28% of those looking to buy a home within the next seven to 12 months. Another 16% said they will be buying in the next one to two years, 9% said they will buy in two years or more and 18% answered that they don’t know their timeframe.