Let’s speculate effect of a massive earthquake on RE and CA economy.

[5yearwaiter]

[quote=enron_by_the_sea]This is what is worrying me.

1) Let’s say a big one hits LA or Bay area. Leveling down a huge number of million dollar homes.

2) Most people there do not have earthquake insurance. The 12% that do, have 15%-20% deductible. (source –

http://articles.moneycentral.msn.com/Insurance/InsureYourHome/GetTheFactsOnEarthquakeInsurance.aspx

)

3) Earthquake results into massive disruption of life and commerce in this area. Rebuilding is projected to take many years. Many people and employers just simply decide to pack up and move some other place. This severally affects economy of the area.

4) The budget deficit of the state skyrockets. Feds help out some, but tea party does not want to bail out crazy hippies and president Palin is severly limited in how much she can help. This causes crisis in the municipal bond market.

5) People have big mortgages to pay on damaged properties without big paying jobs and they start to default which starts the next leg of banking crisis.

Can this happen?[/quote]

If really when this happened then a real shortage of housing occur on a huge demand and perhaps temporarly it appears it might be a disaster but many government resources start provide some sort of relief (like FEMA etc)… eventually a lot demand for homes (either rebuilt or new homes occur). If your recall last San Diego fires – I thought housing is going to be worst but it back like a huge swing. Nothing these factors impact as long as jobs and CA attractive life exists.

[scaredyclassic]

Haiti disaster drove up re pricing on remaining houses

[scaredyclassic]

Haiti disaster drove up re pricing on remaining houses

[scaredyclassic]

Haiti disaster drove up re pricing on remaining houses

[scaredyclassic]

Haiti disaster drove up re pricing on remaining houses

[scaredyclassic]

Haiti disaster drove up re pricing on remaining houses

[joec]

I think after Katrina, housing prices shot up for places which were ok as well…I assume after a massive earthquake, there will be a TON of jobs to rebuild and replan, etc…unless part of the state falls in the Pacific, then maybe folks inland will now live on the coast. 🙂

[joec]

I think after Katrina, housing prices shot up for places which were ok as well…I assume after a massive earthquake, there will be a TON of jobs to rebuild and replan, etc…unless part of the state falls in the Pacific, then maybe folks inland will now live on the coast. 🙂

[joec]

I think after Katrina, housing prices shot up for places which were ok as well…I assume after a massive earthquake, there will be a TON of jobs to rebuild and replan, etc…unless part of the state falls in the Pacific, then maybe folks inland will now live on the coast. 🙂

[joec]

I think after Katrina, housing prices shot up for places which were ok as well…I assume after a massive earthquake, there will be a TON of jobs to rebuild and replan, etc…unless part of the state falls in the Pacific, then maybe folks inland will now live on the coast. 🙂

[joec]

I think after Katrina, housing prices shot up for places which were ok as well…I assume after a massive earthquake, there will be a TON of jobs to rebuild and replan, etc…unless part of the state falls in the Pacific, then maybe folks inland will now live on the coast. 🙂

[Eugene]

We have fairly stringent building standards, They ensure that even a medium-to-large earthquake (say, up to 7.0) will only cause mild damage. If something above 7.0 happens in a densely populated area, the Feds will have no choice but to help, even if Mrs. Palin is the president.

Some people will choose to pack up and leave the affected area rather than rebuild. Many of them will not leave the state altogether, they’ll just rent apartments near their jobs. For example, San Bernardino and Hemet are two cities prone to being wiped out by an earthquake on the San Andreas Fault. Neither of the two are major job centers of their own. Rather, they are exurbs similar to Temecula, and lots of their residents commute to OC/LA. What happens when the earthquake hits? They move to OC/LA and drive up prices there.

The affected area will suffer a drop in population. Safe nearby areas will see jumps in population, rents, and real estate prices.

San Diego is the safest densely populated part of the state to be in with regard to earthquakes. I’d expect it to be an overall winner if the big one does occur.

[Eugene]

We have fairly stringent building standards, They ensure that even a medium-to-large earthquake (say, up to 7.0) will only cause mild damage. If something above 7.0 happens in a densely populated area, the Feds will have no choice but to help, even if Mrs. Palin is the president.

Some people will choose to pack up and leave the affected area rather than rebuild. Many of them will not leave the state altogether, they’ll just rent apartments near their jobs. For example, San Bernardino and Hemet are two cities prone to being wiped out by an earthquake on the San Andreas Fault. Neither of the two are major job centers of their own. Rather, they are exurbs similar to Temecula, and lots of their residents commute to OC/LA. What happens when the earthquake hits? They move to OC/LA and drive up prices there.

The affected area will suffer a drop in population. Safe nearby areas will see jumps in population, rents, and real estate prices.

San Diego is the safest densely populated part of the state to be in with regard to earthquakes. I’d expect it to be an overall winner if the big one does occur.

[Eugene]

We have fairly stringent building standards, They ensure that even a medium-to-large earthquake (say, up to 7.0) will only cause mild damage. If something above 7.0 happens in a densely populated area, the Feds will have no choice but to help, even if Mrs. Palin is the president.

Some people will choose to pack up and leave the affected area rather than rebuild. Many of them will not leave the state altogether, they’ll just rent apartments near their jobs. For example, San Bernardino and Hemet are two cities prone to being wiped out by an earthquake on the San Andreas Fault. Neither of the two are major job centers of their own. Rather, they are exurbs similar to Temecula, and lots of their residents commute to OC/LA. What happens when the earthquake hits? They move to OC/LA and drive up prices there.

The affected area will suffer a drop in population. Safe nearby areas will see jumps in population, rents, and real estate prices.

San Diego is the safest densely populated part of the state to be in with regard to earthquakes. I’d expect it to be an overall winner if the big one does occur.

[Eugene]

We have fairly stringent building standards, They ensure that even a medium-to-large earthquake (say, up to 7.0) will only cause mild damage. If something above 7.0 happens in a densely populated area, the Feds will have no choice but to help, even if Mrs. Palin is the president.

Some people will choose to pack up and leave the affected area rather than rebuild. Many of them will not leave the state altogether, they’ll just rent apartments near their jobs. For example, San Bernardino and Hemet are two cities prone to being wiped out by an earthquake on the San Andreas Fault. Neither of the two are major job centers of their own. Rather, they are exurbs similar to Temecula, and lots of their residents commute to OC/LA. What happens when the earthquake hits? They move to OC/LA and drive up prices there.

The affected area will suffer a drop in population. Safe nearby areas will see jumps in population, rents, and real estate prices.

San Diego is the safest densely populated part of the state to be in with regard to earthquakes. I’d expect it to be an overall winner if the big one does occur.

[Author]

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