Mississippi Gulf Coast Real Estate Market Conditions
Hurricane Katrina was our nation’s worst natural disaster – referred to as the “100 Year Storm”. It destroyed 64,000 homes and 47,000 rental units. But it also may have provided us with one of the greatest investment opportunities of our lifetime.
Prior to hurricane Katrina, the Mississippi Gulf Coast real estate market was showing significant strength due to the expanding casino market, expanding defense industry and baby-boomers looking for more affordable Gulf Coast living. In many respects it offered people a similar but more affordable lifestyle than Florida, at a substantially lower cost.
Following the devastation of Katrina, many construction firms concentrated on the areas needing immediate clean up and repair work. The Governor of Mississippi then announced that there was an urgent need for 100,000 new affordable homes to be built within the following 12 months. But the true rebuilding of single family homes in the area has only recently commenced. There were over 100,000 people living in FEMA trailers. Today 30,000 of those people still live in trailers, and another 40,000 families are living with friends and family due to the severe housing shortage.
Other factors contributing to the increasing housing demand in the Mississippi real estate market include the job growth from larger employers such as the Kessler Air Force Base, the Stennis Space Center expansion, the growing aerospace corridor, shipbuilding, growing international trade zones, and the overall Mississippi business climate.
Additionally, Mississippi changed its gaming laws to allow casinos to build 800 feet onshore. Many of the local builders were given lucrative construction contracts to repair and rebuild casinos. Contractors were hired to work around the clock to meet tight deadlines on getting the casinos up and running. Today the Mississippi gulf coast is the second largest gaming destination in the USA next to Las Vegas.
Recent economic studies show that the Gulf Coast area is recovering. Statewide, gross state product and employment have surpassed pre-Katrina levels and a reconstruction boom is anticipated for the next five years. Post Katrina employment growth in the state more than offset jobs that were lost due to Katrina. Retail sales in the twelve months after Katrina are 19% above pre-storm levels, indicating further strengthening in the economy.