Buying and selling real estate in the communities of Long Island
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Cuomo: NY willing to buy vulnerable waterfront homes
Gov. Andrew M. Cuomo said the state is willing to buy properties from homeowners who live on the state’s shores, which are seen as increasingly vulnerable after Sandy.
In an interview with the New York Daily News, Cuomo expanded on the promise -- first laid out in the budget he unveiled this week -- to use money apportioned for Sandy recovery to buy waterfront properties from people fearful of the prospect of a third consecutive year of devastating storms.
“We give you a check and you move on,” he said. “We take the property.”
It likely comes as welcome news for Long Islanders who are eager to abandon the state’s most susceptible land but who are unable to find buyers willing to take it off their hands.
Fortunately, Cuomo indicated that the state would be “generous” and pay “fair market value” for the properties, which could eventually be reserved for parks and public spaces instead of housing.
But the governor acknowledged that this news might be coming too late for homeowners who have already begun the rebuilding process, and noted that the state would have to find ways to compensate for the real estate tax revenue lost because of the initiative.
For homeowners and Long Island’s real estate community, there’s a third question that must be answered: what is “fair market value”?
It’s an easy, if expensive, question to answer were Cuomo referring to pre-storm appraisals. But with increased awareness of the possibility of future storms the “market value” of those properties has now diminished significantly and may not represent enough money to compel these owners to sell — let alone arm them with enough cash to move.
Further complicating the issue is how mortgage lenders would react to the offers, especially if the “fair market value” is worth less than the balance on whatever outstanding loans exist on the property.
These are questions that must be answered before such transactions gain traction.