(MoneyWatch) One year ago, Peter Karadimas was staying with a friend when his East Norwalk, Conn., home was hit by the massive storm surge created by Superstorm Sandy.
The next day, he and his sister drove back, carefully navigating around debris and downed wires until they made it to his neighborhood.
"We were sick to our stomachs," Karadimas said. "We were just in shock."
The home he and his sister shared as children, where he still lives today, had been flooded by both seawater and sewage when his pumps failed -- creating a smell that permeated the whole home, Karadimas said. The wall and ceilings were cracked. Furniture, papers and clothes were scattered around the home and yard.
About half the home had to be replaced he said, from walls and woodwork to furniture and appliances.
Karadimas' story is just one of thousands, but it may have a happier ending than most because his insurance covered all of the damage, he said. Homeowners from Delaware to Rhode Island have spent the past year struggling to rebuild homes in what were once sought-after coastal communities.
"It was actually scary for the first couple of days. Trees toppled over, power lines were down and everybody started panicking," said Anthony Napolitano, an associate broker with Coldwell Banker Real Estate in Massapequa Park, N.Y.
Then his phone started ringing off the hook with homeowners looking for any place warm and dry to rent.
"I had people coming in the office crying that they need a place to stay," Napolitano said. "I was appalled to hear the stories of landlords increasing the rent, even doubling their rent."
Elaine Patterson, an associate broker with Douglas Elliman Real Estate, often had to turn people away because no properties were available.
As time went by, debris was replaced with dumpsters and mobile homes dotting the neighborhood.
"As that was happening, each week you would see garbage at the curbs and everyone was working overtime to clear it," Patterson said.
It took three months before communities started to look the least bit normal, the agents said. Even now, things don't look the same. Patterson estimates that at least 15 percent of local residents, mostly senior citizens, have simply moved out.
Meanwhile, some of those still living in the area, and those hoping to buy, are faced with huge insurance headaches.
"It doesn't help the insurance companies are dropping people, people who didn't even get hit by the flood," Napolitano said. "You'd think they would have helped out as much as possible."
Insurance costs are going up, particularly flood insurance, and not just because of storms like Sandy. The July 2012 Biggert-Waters Flood Insurance Reform Act is causing flood insurance premiums in flood zones across the country to soar, and those looking to rebuild in Sandy's path are feeling the effects first.
Mere months after Sandy, FEMA revised maps in the New York/New Jersey region, placing more homes in the floodplain than before. The result is that more homeowners need flood insurance that is also more expensive. A part of the law that rolled out this month also removes subsidies that discount the cost of federal flood insurance premiums for homes that existed before flood insurance rate maps were drawn.
Homeowners there are facing flood insurance increases that would take a premium from a few hundred or thousand dollars to tens of thousands of dollars a year, according to a report from the RAND Center for Catastrophic Risk Management and Compensation. They can try to raise their homes a few feet to save some money, but are still looking at increases.
While Karadimas' insurance premium has only gone up about $900 this year and is still under $3,000, he's hoping he doesn't see those kind of increases because his home is at a high enough elevation.
Ultimately, though, if another storm like Sandy hits his area, Karadimas said he won't be able to stay in his home.
"I can't live like that," he said. "If these storms are going to be more frequent and more devastating, do I need to be one house in from the water?"
Click through the gallery to see before and after pictures of some Sandy-struck homes.