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Blog: Harvey, Irma exact devastating toll


Two massive storms hit the U.S. back to back over the past two weeks and have walloped great swaths of Southeast Texas, Florida and the east coast. It will likely be months before the total extent of the damage wrought by Hurricanes Irma and Harvey is known.

Analysts have a better grasp of the devastation visited on Houston and Southeast Texas by the first storm, Harvey, which made landfall on Aug. 26. It then lingered as a tropical storm, dumping a record 50 inches of rain over three days and causing widespread flooding.

hurricaneirmaWhile damage estimates remain only tentative, it is already clear that Harvey will go down as one of America’s most destructive storms. It could be the worst ever in terms of property loss and near-term business interruption, according to the Texas-based economic-research consultancy the Perryman Group.

Accuweather has pegged Harvey's damage at $190 billion, nearly equal to the costs of Hurricane Katrina and Sandy combined.

“It is, however, widely recognized that the cost will exceed those of Hurricane Katrina, which had been the costliest storm to date,” said Perryman Group CEO M. Ray Perryman. “Time will be required for repair of buildings and infrastructure, and the loss of business activity will be substantial.”

Several data-tracking companies have already tried to estimate the potential damage to homes and commercial buildings in Texas and Louisiana.

In a report issued last week, the data and analytics company Black Knight said 1.18 mortgaged residential properties with a principle balance of $179 billion were within the Harvey disaster areas designated by the Federal Emergency Management Agency (FEMA). That is more than double the mortgaged properties connected to Hurricane Katrina, the 2005 storm that destroyed a portion of New Orleans.  Black Knight predicted that as many 300,000 mortgages involving properties in the Harvey impact zone could go 30 days delinquent, and 160,000 could fall into serious delinquency at 90 days past due.

CoreLogic estimated the damage to homes from Harvey’s initial storm surge, wind and flooding could total $25 billion to $37 billion. As much as $27 billion would be uninsured flood loss, the company said.

The damage to commercial properties also is potentially catastrophic.

According to CoStar, the greater Houston area is the sixth largest market in terms of commercial real estate (CRE) space. In an early report, CoStar estimated that just over a quarter of that CRE space, properties with a total value of some $55 billion, were in the Harvey flood zone and could be damaged.

As for Irma, the storm has just moved out of Florida. Early reports say that nearly a quarter of the homes in the Florida Keys could have been destroyed.  


 

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