Lack of Sandy aid for second-home owners forcing many to walk away

Source: Asbury Park Press, N.迷你倉J.Oct. 27--As bungalows and other vacation homes rose in the sand along the Jersey coast in the 1950s and '60s, a factory worker could afford to buy one.As that heyday of manufacturing in New Jersey gradually faded, so did the blue-collar dream of owning a second home on the beach.Will the effects of superstorm Sandy and rising flood insurance premiums finally bring that dream to an end?"The fabric of the Jersey Shore is going to change," said Peter Reinhart, director of the Kislak Real Estate Institute at Monmouth University in West Long Branch. "It's going to be a rebuild or not rebuild decision for a lot of families."Second-home owners have been locked out of government aid for repairing and elevating houses. Providing loans and grants to repair vacation homes may not generate much public support, but not doing so means fewer homes will be restored."It's obviously a negative," said James W. Hughes, dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers. "The exact scale of that negative remains to be determined."The result, say both economists: "gap-tooth" neighborhoods and further shifts in the demographics of the Shore."You're likely going to see more affluent families moving in," Reinhart said.The Ocean Beach section of Toms River, one of those blue-collar dream communities, sprang up immediately after World War II.The one- and two-bedroom cottages built there in 1946 went for as little as $2,095, according to a history of the community on the website of Ocean Beach Sales & Rentals. That was less than 1 percent of what they sell for today.Weekly take-home pay for a factory worker then was $46, according to a presidential economic report of that time."It enabled the blue-collar New Jerseyan to really live the good life," Hughes said.Homes there now range from the low $200,000s to much more, depending on the location. Homes that escaped damage and do not need to be raised are commanding a premium. One 560-square-foot home near the bay on Swordfish Way in Ocean Beach, which was built in 2008 above the new base flood elevation and sustained no interior damage during the storm, is listed for $399,000.Today, the average factory worker -- an occupation commanding much less of a salary now -- takes home roughly $500 a week, according to U.S Department of Commerce statistics.Then came SandyThere are no official statistics on how many second homes were damaged by Sandy.But Toms River, one of the hardest-hit towns in New Jersey, provides a sense of the scale of destruction.About 9,446 second homes lie in Sandy-impacted areas in Toms River, said Jay Lynch, township planner. Toms River has about 43,000 residential units.Many of the second homes in the township were passed down through families, he said."Some may have escaped damage, but not too many," he said. "A lot have second- and third-generation owners who didn't have a mortgage and so didn't have flood insurance. And they are middle-income people."These aren't the people with beachfront homes," Lynch said. "They want to fix (their homes), but they can't figure out how. They don't have a heck of a lot of disposable income."Many, he assumes, will sell out to people with more money.In Little Egg Harbor, around 40 percent of the housing stock, 4,017 homes, was damaged, about a third of them second homes, township officials said.In Brick, another township devastated by Sandy, some 8,400 homes sustained damage, about a third of them second homes, said Mayor Stephen Acropolis.Short-shrift?Vacation homeowners文件倉like Jay Whalen, 53, of Jackson, who owns a 750-square-foot home on Mystic Island in Little Egg Harbor, are digging deep and agonizing over choices."I'm $80,000 short," Whelan said of the money it will take to lift his house. Insurance money took care of the repairs, he said.Although acknowledging the need to fix primary homes first, he and many other second-home owners are bemoaning the lack of help from the government given their investments in their stricken communities."We pay taxes; I only use (municipal) services 40 to 50 percent of the time; my kids don't go to the local schools," Whalen said. "We're second-class citizens. There's tens of thousands of us in this position."Whalen and other second-home owners are particularly vexed by the perception that vacation homeowners are millionaires with oceanfront properties. The recent program giving first-time homebuyers $50,000 forgivable loans to purchase homes in Sandy-stricken counties also is raising their hackles."Now they're giving money to people who weren't even affected," said Jennifer Netta of Watchung, who owns a home in Mantoloking Shores section of Brick. "It's a slap in the face."Netta's home suffered little damage, but she has become an advocate for neighbors and relatives, delving into the particulars of the National Flood Insurance Program.Whalen, with a son in college and a daughter about to finish high school, says he likely will dip into retirement money to fix the home.A vice president for a software company, Whalen does not fit the profile of blue-collar workers clinging to their homes. But many of his neighbors do, he said. And some already have ended their time here, opening themselves up to foreclosure."This block alone has 22 houses, probably 10 of them are junk," he said. "People have had to walk away."His wife, Debbie, said at least four owners have abandoned their mortgaged homes.Real estate agents say the only people who walk away from Sandy-damaged homes are those with mortgages. And abandoning a home doesn't make financial sense if you have recoverable equity in it, since foreclosure means the loss of any equity, lending experts say.While the economic forces of the housing boom had long ago kept those with modest incomes from owning at the Shore, Sandy will shut the door for more."With a storm as destructive as Sandy, it has essentially redefined and drastically reduced the inventory" of homes, Hughes said. "Homes will now be much more expensive."Then there is flood insurance. Premiums are expected to rise to as high as $15,000 a year.Hughes compared owning a beach home with rising flood insurance rates today with moving to then-cheap Pennsylvania when crude oil was selling for $10 a barrel. The 60-mile commute was affordable then, but far less when gas rose to $100 a barrel.But the look of the Shore also will change. Ruined homes may not disappear as quickly as many would like."To the extent that they can't rebuild and still own the land just creates a whole lot of immobility," Hughes said. "That's not an environment that people are going to feel confident putting money into. It could be a blight on the land for a decade."But the influx of more affluent buyers will mean larger, raised homes with more expensive landscaping and stairways -- like the homes on the North Carolina coast, Reinhart said. That, in turn, will bring more upscale businesses and restaurants.Copyright: ___ (c)2013 Asbury Park Press (Neptune, N.J.) Visit the Asbury Park Press (Neptune, N.J.) at .app.com Distributed by MCT Information Services存倉