Gulf coast property values expected to plunge because of the oil spill

Property values could plunge billions in value along hundred of miles of the Gulf coast, according to an analysis. 

Lost property value could total more than $4.3 billion, representing a 10 percent decrease from the effects of the oil spill, said Norm Miller, CoStar Group vice president of Analytics, on Friday. 

"It’s impossible at present to estimate the degree of property value decline from the spill," because of the already weak housing market in Florida," Miller said. 

To reach his conclusion, Miller used an average cost of $3 million an acre and subtracted a 10 percent value hit from the oil spill across 569 miles or 14,396 acres affected. 

"That's probably an understatement in assessing the impact to environmentally sensitive wetlands," Miller said. 

The spill could cost 195,000 jobs and nearly $11 billion in revenue to Florida Gulf Coast counties alone, according to a forecast released Tuesday by University of Central Florida economist Sean Snaith, director of UCF's Institute for Economic Competitiveness.

The institute noted the effects of the spill could have far-reaching effects across the entire state. Florida officials have started an advertising campaign to provide tourists with information about the spill and advocate unaffected parts of the state.

The disaster could cost insurers between $1.5 billion and $3.5 billion, according to a Moody’s Investors Service in a report last month.