The term “man-made disaster” generally refers to a catastrophic event that is directly caused by human activities such as industrial accidents, pollution, deforestation, and others. In the context of real estate, this could potentially mean various things. For example, a local factory could pollute a nearby river, causing health hazards, thus lowering property values. Or, massive deforestation could increase the risk of landslides, making a certain area less desirable.
Various factors could make it harder to buy or sell homes following such a disaster. Firstly, potential homebuyers might be hesitant to invest in an area that has recently experienced a disaster due to concerns about safety, property damage, or long-term consequences such as health risks. This could lower demand, thus making it harder for homeowners to sell their properties.
Secondly, physical damage to properties or infrastructure could also impact real estate transactions. This could involve direct damage to homes or broader issues affecting accessibility or quality of life, like damaged roads or loss of public amenities.
Thirdly, insurance rates could skyrocket in such an area, making it more costly to own a home, which could deter potential buyers. Also, lenders might be hesitant to provide mortgages for properties in disaster-stricken areas, considering them a risky investment.
Finally, the recovery process after a disaster can be long and uncertain. Potential buyers might prefer to invest in an area that is free of such uncertainties.
That being said, every real estate market is unique and it ultimately depends on the specifics
