Harvey's Impact on Houston



Hurricane Harvey hit us pretty good but Harvey is not the first storm to hit the Houston area. We had Carla in 1961. Alicia in 1983. We had the 1994 floods when the San Jacinto River caught fire. In 2001, We had tropical storm Allison. In 2005, we had Hurricane Rita. Hurricane Ike came in 2008. The Memorial Day floods were in May 2015. The Tax day floods were in April 2016. Now we have Harvey, who like a bad guest, overstayed his welcome and pounded our area with 50-inches (over four-feet) of rain in just a few days.

HOUSTON FLOODS. We flood often and sometimes we flood dramatically. The Addicks and Barker-Cypress dams, that we are now so familiar with, were built as a response to two sets of catastrophic Houston floods – the floods of 1929 and 1935. Construction started on these dams in 1942 and was completed in 1948. These reservoirs were designed to control the flow of water along Buffalo Bayou, preventing flood waters from rushing into downtown Houston. At the time, the reservoirs were far west of Houston itself. Residential and commercial development now surrounds both Reservoirs.

What makes Harvey feel different? I think two things. First – the sheer size and scale of Harvey. Fifty-inches of rain – for days and days. 156,000 flooded homes (and still counting).  Many people are feeling the pain of Harvey. The second factor making Harvey feel different is the recent compression of flood events. For way too many people, this will be the third time their home has flooded since May of 2015. I think having your home flood once, is one time too many.


As real estate practitioners, what can we expect regarding future home sales? First and foremost – Houston will rebuild. We always have, and that is not going to change now. In the long-term, this event will be a blip on the charts. Neighborhoods will rebuild. Some may look different due to smarter building styles. We are a vibrant city. We have plenty of jobs, and our home prices are lower than national averages. People will continue to flock to Houston for housing and jobs.

In the short run, the volume of home sales will decline. Many Houstonians will be very busy, rebuilding our homes and our lives. Generally speaking, mortgages are not available for flood-damaged homes. Flooded homes will have to be rebuilt or, maybe, demolished. Mortgage applications will decline. Even homes that were not damaged may require additional certifications or inspections to certify to lenders these homes are livable and in good condition. Resale activity will diminish significantly off of normal. One year from now, we can expect a flurry of sales activity as these rebuilt and/or new homes come on the market.

The numbers are still bouncing around, but Harvey flooded somewhere close to 68,000 homes in Houston and somewhere north of 156,000 homes in the general southeast Texas area. Those people will need places to live. The rental market will be very busy for the next year or so. We actually had a slight oversupply of apartments leading into Harvey. Flood survivors will absorb nearly every rental property available while they rebuild their homes and lives.

Because of this huge pipeline of new, survivor, tenants, we can probably expect to see upward pressure on rental prices. Simple supply and demand. Landlords with available properties can expect multiple offers for their properties. Landlords should be very sensitive to the possibility of price gouging. If rent prices go up due to an increase in demand, is that price gouging? I’ll stay out of that argument for the moment.

What about home sale prices? Will prices for non-flooded homes go up? Those same 68,000 or 156,000 homes regionally are no longer available for occupancy, and, for the most part, are not available for sale. Some of these homeowners may have been considering selling their homes and moving pre-Harvey. Not for any specific reason other than the normal reasons people move. They want a bigger house, a smaller house, a different location or lifestyle. Those now-flooded homes that may have been current listings – are not.  The supply of readily available, “non-flooded” homes will diminish.

(We should be careful with the term “flooded.” Most of us likely believe the term “flooded home” to generally mean – a home impacted by rising water entering the home. I have heard comments by non-real estate practitioners – that their home only had four inches of water and therefore, did not flood!  Not included in the “flooded homes” numbers are homes that did not suffer from rising water but, had blowing water enter the home through door sills, windows or roofs or chimneys that simply were overwhelmed by the non-stop rain. It appears we will need to be very specific when we question homeowners whether their home flooded or not. )


Appraisers are data hounds. We are always looking for hard facts – closed sales. For those of you familiar with the appraisal process, we are looking for recently closed sales of comparable properties in the same neighborhood. For the immediate 90 days after Harvey, closed post-Harvey sales will be elusive, if not simply unavailable. Data will be hard to find. If you want to be a bit of an appraiser nerd, think about this – All, or most, of the sales available in the very near future, will have occurred “pre-Harvey.” Any potential effect of Harvey on specific market prices will not be known until there is sufficient “post-Harvey” data available. The effects of Hurricane Harvey may not be recognized in many post-Harvey appraisal reports. I have appraised Houston real estate since before Hurricane Alicia in 1983. I have been through all the storms since then.  Many appraisers simply will not have the experience necessary to accurately appraise property in this market.

You are going to hear a lot of big-time economists pull out their charts and graphs and try to relate Harvey to Katrina or some other event. That is their job, and it may help large, multi-national corporations determine a near-term Houston business philosophy. That data is too general to be applied to any one of our personal and specific situations. Ignore that information. It does not apply. As my redneck buddy would say – “This ain’t New Orleans fellas.” He is correct. Our situation is different, and our solutions will be different.


Within this article, I can help you understand the complexity of the issues, but there is no answer here to your personal situation. There is no generic – one size fits all answer. These decisions are complex and very personal. For flood survivors (not victims), the decisions are both monetary and personal.

Your questions and personal situations are as varied and individual as your fingerprints. Each answer must be tailored your specific property. I can help you determine the value of your home, but only you can decide where you want to go from here.


The big one – Does this event change the value of my home now?  Maybe.

My home never flooded before. Should I rebuild my home?  First, I think you have to answer this question – Do I really want to live there anymore?

Should I sell my home now ”As is” or should I fix it up, then sell it?

My house did not flood. Is it worth more now?

My accountant says I need an APPRAISAL of my property showing the value of my home the day before the flood and the value of my home the day after the flood. Likely to calculate your uninsured loss for the IRS. Can you help me?  YES.

My house flooded but, only after the release of water from the dam(s). Is my home affected the same as all the other flooded homes?

The answers are different for each situation. Below are examples of different situations and the homeowner’s response.


I had one friend who had to defend her home from wake damage. She lives in a normal subdivision, not on a lake, river or creek.  The water was right at her doorstep. The water level had peaked and was not getting any higher and her home was not going to flood! Her home was going to be saved – until – all the monster trucks and boats came down the street – throwing boat wakes at the home. She put a NO WAKE ZONE sign in front of her house.

One homeowner had lived in the same home for the past 27 years. Never flooded. Never even got close. He was not in a designated flood zone. He did not have flood insurance. Why should he? Flooding simply was never a concern in his mind. He flooded badly during Harvey. His attitude now is – his home let him down. The home that had kept him warm and dry for 27 years – had failed him. This home was no longer his safe haven. He wants nothing to do with that home anymore. He wants out! He wants to move now! He doesn’t want to rebuild. That property is no longer his home. He is done with it. Sell it now!

A homeowner bought a two-story home on Cypress Creek two years ago. The creek provided nice views and privacy. No rear neighbors except the wildlife. He paid approximately $500,000 for the home then.  The home was in a designated FLOODWAY (read – temporarily dry riverbed). The owner was aware of the risk. He had flood insurance. It was required by his lender. The first floor flooded. While his home was filling with water, he carried his valuable items upstairs for safety. A few days after the waters receded, he accepted an offer for $300,000. As is. He moved all his dry stuff out of the second floor and left all the first-floor stuff where it lay. The buyer asked – Don’t you want any of this stuff? Nope.

One owner told me – Nobody in my neighborhood has ever flooded before – but the most of the neighborhood flooded this time. He lives in a recently developed 12-year old neighborhood. My question to him was – How do you know your neighborhood has never flooded? Your home and the entire subdivision is only 12- years-old. Fifteen years ago, your neighborhood was a rice paddy. For all we know, the land your home is built on has been flooding for hundreds of years. Only the cows know.

A few years ago, I was the speaker at the annual Meyerland homeowner’s association meeting. I was asked to speak at that meeting because they had just gone through the Memorial Day flood of 2015. For many of those homes, that flood event was the first time their homes had flooded. I met a very nice woman there. She was 82 years-old. (She volunteered her age to me happily. She was quite proud of it.) She had lived in her home for 53 years and it NEVER FLOODED BEFORE. It flooded in May 2015 for the first time.  I asked her what her plans were. She reminded me she was 82 years-old. She told me was moving to Tomball or anyplace where it doesn’t flood. She had no intention of being in that house when it flooded for the second time. (I checked on her. She stayed high and dry – far away from any of the recent Harvey flooding.)

Many of the other Meyerland homeowners I spoke with that night, spent much of the next year rebuilding their homes. They liked the community and their neighbors. They would rebuild their homes and make them nicer than before. Many of those homeowners had just recently moved back into their renovated homes in April of 2016 when the Tax Day rains flooded their homes a second time in a one-year period. I have a personal friend who lives in the area and has now survived her third flood. Unfortunately, there are many homeowners just like her. Some of those owners will sell their homes “As is” and move. Some will rebuild their homes again and hope this is the last flood. Some will rebuild their homes only to sell them and move to higher ground.  Every owner will respond differently to his or her individual circumstance.


Houston floods but so do many other communities in Texas and around the world. I can’t even begin to count how many times the Guadalupe River has come roaring down that river channel dragging everything along with it. But, there are more people with homes on that river now than ever before.

We humans like to live in dangerous places – mostly because they tend to be beautiful. Look at all our coastal properties, not just here in Texas, but all around the world. Most all waterfront properties are subject to some kind of extreme risk. Hurricanes here and the east coast. On the California coast, those homes simply fall into the ocean. Many river homes flood every time they get a heavy rain.  Homes in the mountains are subject to wildfires, avalanches or simply sliding down the hillside. Some of the world’s most expensive homes are perched in very precarious situations. Yet, we keep living and building newer and bigger homes there. Because we like living there.

I have been appraising property in the Houston area for the past 35 years. Since then, we have gone through many storms. We will go through many more in the future. Unfortunately, some of us will flood again.


Can we prevent flooding? Of course not. Not entirely anyway.  Obviously, we could at some obscene price, but it is doubtful any of us would be willing to pay that price. We have to face up to the fact that we live in a floodplain. Can we do a better job of floodwater management? Sure, we can. We are a city of engineers and smart people. We can immediately implement smarter building and development standards. We probably should be building most our homes on pier and beam style foundations, especially in places like Meyerland and Bellaire. You can build a very nice, attractive and desirable home on a pier and beam foundation. Let any excess water flow UNDER YOUR HOME – NOT THROUGH YOUR HOME. Better building codes. Build smarter. It’s not that hard. Remember, we are Texans. We can do a better job.

We can build new, and/or improve upon our existing retention lakes – bigger, deeper, better and more of them.  The Addicks and Barker Cypress reservoirs were built 70-years ago; they have since “silted in” and no longer have their original capacity. Those things need regular maintenance. Dig them deeper. Waaaay deeper. We probably need a third reservoir.

We have water here on the gulf coast. West Texas needs water. We pump oil all around this country. Let’s pump a little water. If not to west Texas, then pump our excess down to the gulf. This is not complicated stuff. It is expensive. No question about that.  We need smart leaders and the political and financial will to get it done.


DOES THIS EVENT CHANGE THE VALUE OF MY HOME?  If your home flooded, apparently the value has changed. If your home did not flood – maybe –  but maybe not.

MY HOUSE DID NOT FLOOD. IS IT WORTH MORE NOW? Maybe. It depends. Was your house the only house in the neighborhood that did not flood? Maybe your home stayed high and dry but, because of the street flooding, you couldn’t get in or out for a week. Perhaps your home was dry, but the cars in your garage flooded. It all makes a difference. The truth is, we really won’t know until the sales start to roll in. Ultimately, any question concerning the present value of your home will be determined by buyers. Just how are buyers going to respond to all of this. It’s almost impossible to predict.

MY HOME FLOODED. WHAT IS IT WORTH NOW? Probably less than before. I know this answer is not going to make anyone happy, but there is no generic answer. How much damage did your home sustain? Are you in a designated flood hazard area? How many times has your home flooded? Has it flooded only this one time or is this the third or fourth time? Did your home only flood because of the release from the reservoirs? Future buyers will determine the sales price of your home when you sell it.

MY HOME FLOODED. SHOULD I REBUILD MY HOME?  There is no simple answer. The answer will be different for each individual considering their specific situation, both personal and financial. The first and most important question you have to ask yourself is – Do I really want to live in this home anymore?

“My home never flooded before” is different from “My home has flooded twice.”  “My home has flooded three times.”  Well, really now – who wants to shoot for four times? Past flood events will have to be disclosed to future buyers. Is reasonably priced insurance available? Those things will matter to them. Future buyers may want more evidence of proper remediation. They will likely want very thorough inspections before they buy.

The cost to repair the home will be a major factor. Is it covered by insurance? How many of the repair expenses are uninsured and will have to come “out of pocket.” Can you afford it?

SHOULD I SELL MY HOME “AS IS” OR SHOULD I FIX IT UP THEN SELL IT?  This answer to this question is similar to the one above. Are you getting insurance money to help rebuild? Do you have the time and energy to restore the home?


These reservoirs were created after the 1929 and 1935 Houston floods. For interesting reading and great pictures of early Houston, Google those flood events. Even if you don’t enjoy reading, you’ll like the pictures.

The Addicks and Barker reservoirs were designed and constructed to prevent the kind of flooding seen in those two early and spectacular flood events. (As I said – Houston has been flooding for a long time.) The construction and funding were approved by Congress as part of the Rivers and Harbors Act of 1938. President Franklin D. Roosevelt signed the measure into law.

Construction started on Barker Dam in 1942 and was completed in 1945. Construction on Addicks Dam started shortly after that and was completed in December 1948. The reservoirs were designed to control the flow of water into and along Buffalo Bayou, preventing floodwaters from rushing into downtown Houston.

At the time of their original construction, the reservoirs were far away and west of Houston itself. Now, Houston, one of the nation’s fastest-growing cities has grown to meet them. Neighborhoods, houses, and businesses now surround both reservoirs. These systems are approximately at 70-years old and have long been showing their age. Both systems have been ignored for years and now need repairs and regular maintenance. Current analytical technology now provides a better understanding of how water flows in our area. Current construction technology provides improved methods of managing this water. Many Houstonians rely on these two systems regularly to regulate water flow safely around our homes and neighborhoods and out into the gulf. All of our storm-water management systems require constant maintenance. This maintenance costs money.


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