Many residents may not be able to afford to remain in their homes as repair and insurance costs rise in flood-prone areas.
From Highlands to Holgate at the tip of Long Beach Island, a pattern of contrast, stitched over generations, endures as blocks of low-slung bungalows give way to rambling million-dollar Colonials with sweeping beach views.
That's almost sure to change now.
On top of the high cost of living at the Jersey Shore, there now is the added price of rebuilding from Superstorm Sandy. Given that insurance payouts have so far come up short, many homeowners' savings were sapped in the recession and planned increases to the National Flood Insurance Program could get as high as $10,000 a year for homeowners in the highest-risk areas, real estate and banking experts expect the next decade to see a significant shift along the region that favors the well-off over the working-class.
Census data show the diversity before Sandy hit. In Monmouth County, where the median home value is $413,500, 39 percent of families had annual incomes of $100,000 or more from 2007 to 2011, while 28 percent earned between $50,000 and $100,000. In Ocean County during that period, 35 percent of families had income of between $50,000 and $100,000, and 34 percent had incomes of $100,000 or more. The median home value is $284,100, according to the census bureau.
"There's no mistaking that there will be some homeowners that will be priced out of the market," said Roland Anglin, director and associate research professor at the Joseph C. Cornwall Center for Metropolitan Studies at Rutgers University. "There will be some shaking out of the market. That's what happens in crises like this, because people don't have the financial wherewithal — the savings — to buffet these effects."
A year after Sandy, there is no hard evidence of such a shakeout. But change is slow. Anglin, who spent several years in the Gulf region after Hurricane Katrina hit, said "there really isn't a life cycle" for when a homeowner realizes they can no longer afford to stay. It is usually around the one- or two-year mark after a disaster, when the insurance companies finalize their payouts, he said.
"What happens is, insurance never covers all of the damage," Anglin said. "So when you have families that are living on the margins, they can't recover the resources to rebuild effectively, and so they make tough decisions."
Those tough decisions could lead to an altered landscape, one where larger, grander and pricier development replaces the more humble traces of the Shore's history.
New flood zone maps require homes to be raised, digging deep into the pockets of property owners — the low end is around $20,000, said Peter Reinhart, the director of the Kislak Real Estate Institute at Monmouth University. Homes that are not raised are subject to large increases in the government-run flood insurance program.
Most homes in the Shore region are in what is called an AE flood zone. According to the Federal Emergency Management Agency, rebuilding in that zone could cost about $1,700 a year for a policy. Homeowners in the VE zone, the most susceptible to flooding, could see policies up to $10,500. As a result, Reinhart said, "You're going to find that fewer people of modest means able to keep their Shore home."
"That's just going to change the fabric of the Shore," he added.
Take the Cherry Quay section of Brick, where Mayor Steven C. Acropolis lives. Before the storm, the lagoon-front neighborhood was a blend of renters and homeowners. During the storm some homes were flooded, others were damaged by fire and some were victims of both, he said. Acropolis still lives in his home, which he said suffered "substantial damage," but many of his neighbors have fled, and some homes are waiting for the bulldozer.
Jack McGrath's is among them.
The 47-year-old chef, who owns Brick Oven Restaurant in town, rented a ranch for about five years before Sandy flooded the home and destroyed its contents — furniture, appliances and keepsakes he estimates to be worth upwards of $20,000.
"If it wasn't nailed to the wall or 3 feet above" the floor, he said, "it's gone."
McGrath said he received a check from FEMA for $3,000 for relocation costs. Since the storm he has been living in Spring Lake Heights, in a condominium that has been in his family for 35 years, because, he said, "I couldn't afford to just start over." He cannot return to his rental, he said, because it is scheduled to be demolished. One day he'd like to get back to Brick, or at least Ocean County, but he's not sure when. He's also worried that rents will continue to go up in the meantime, pricing him out of the area all together.
"I haven't been completely pushed out," McGrath said, "but I've definitely been pushed."
Towns potentially stand to benefit from a working-class diaspora. Inevitably there will be deep-pocketed buyers for a properties or costly homes that need to be raised. Developers also will likely eye swaths of land they see worth the risk. And development means tax revenue for towns.
In Union Beach, for example, a parcel off of the Raritan Bay is zoned for townhomes. Before the storm there were about seven old homes that were mostly rented out, Mayor Paul J. Smith said.
Now there are just a couple left, and the town is hoping a developer will make use of the bayfront land by building a more modern, upscale cluster of homes. New development in that area would mean more tax revenue, Smith said.
"It's a working-class community. We're a paycheck-to-paycheck town," he said. "But there are some areas where they (developers) could do something right."
This is the double-edged future for municipalities on the coast.
"Do I think that Brick will be more financially viable 10 years from now? Absolutely," Acropolis said. "But I'm sad to the point that there's going to be a lot of people who live here, who rented here, for a long time leaving because they can't afford it."
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