Report: Gulf oil spill could mean $4.3 billion in lost real estate values

The hits just keep on coming for those in and around the Gulf of Mexico.

Business Week reports that the disastrous uncontrolled BP oil spill one mile underwater, which continues to spew millions of gallons of crude into the ecologically-sensitive waters, will likely significantly impact shore-area property values.

To the tune of $4.3 billion — as much as 10 percent — over the next three years for a 600-mile stretch of prime waterfront real estate.

Alabama, Florida, Louisiana, Mississippi and Texas all border the Gulf of Mexico, which also happens to be a way of life for many residents near the water’s edge.

Indeed, tourism, fishing and other big-time industries have already been hit hard because of the crisis. And now its deleterious affects appear to be on their way toward trickling down to innocent homeowners.

In fact, Don Epley, director of the center for Real Estate at the University of South Alabama in Mobile, Ala., predicts foreclosures are likely right around the corner:

“The defaults will start happening in early fall. You can directly attribute those to the oil spill.”

The report, which references a recent study from CoStar Group Inc., hotels and restaurants are also in major jeopardy of falling into default. Without tourists and other visitors, it will be hard for these establishments to make ends meet.

BP PLC — the massive oil-producing giant responsible for the disaster — has already earmarked funds to help offset the losses in the tourism and fishing industries. Whether or not the company will also put funds aside to assist struggling home/business owners affected by the spill remains to be seen.