MBA: Cost of Repairing Katrina-Flooded Single-Family Properties in New Orleans Between $8-$10 Billion

WASHINGTON – The Mortgage Bankers Association released the findings of a study it did concerning the damage to properties in New Orleans from Hurricane Katrina, and the news is definitely sobering. The association estimates the cost of repairing the 95,000 properties in the city damaged by floodwaters from Hurricane Katrina will total between $8 billion and $10 billion. The study used property level damage reports on over 117,000 properties inspected in New Orleans and applied repair cost estimates based on structure types, location, degree of damage and current builder quotes. Among the major findings of the MBA’s study: * almost 95,000 of the estimated 143,000 single-family residential structures in Orleans Parish suffered some degree of flood damage. * damage percentages vary widely by zip code, ranging from 95% in some areas to only 2% in others. * the pre-Katrina market values of the properties damaged by the floodwaters totaled between $17 billion and $18 billion. Flood insurance is only expected to cover between $4 billion and $5 billion. * a minimum of 29,000 homes that suffered any amount of flood damage didn’t have flood insurance, with the more likely number in the range of 34,000-35,000. Many of these homes were either owned outright or likely located outside FEMA designated flood zones. * a proposal to pay property owners about 60% of the pre-Katrina values of their properties would cost about $9 billion if every home in the city with 25% or more damage were purchased at the 60% maximum.