One could argue that Sandy may provide somewhat of an economic boost to New York City in 2013. To the extent that the storm destroyed property and hindered job growth in late 2012, the rebuilding effort and expenditures including the Federal aid just now being approved piecemeal by Washington, could provide a tailwind in 2013.
Certainly the storm did some damage to the local real estate industry. Like many other industries, most business could not be transacted in the immediate aftermath. Rental properties and primary residences in affected areas still stand vacant, and properties now listed for sale in those areas face the likelihood of discounting to compensate for concerns like lingering structural damage and susceptibility to future storms.
The Federal Reserve has an interesting blog discussing the potential for an economic recovery in the wake of Hurricane Sandy. Based on several major natural disasters, typically there is a sharp recovery in jobs particularly in construction.
“Federal funds, the resilience of the public and private sectors in the affected areas, and policy decisions made in the days and weeks following the disaster all combine to influence the strength and rapidity of the recovery.” I guess everything else worked pretty well except for the Federal Funds held up in Congress.
Finally, the authors give us a possible silver lining, intimating that the recovery activity following 9/11 may have helped the region rebound from a recession more quickly. We already saw a slowdown in hiring due to Sandy, the next regional employment numbers should show a surge in employment related to Sandy recovery activities.