The Graggs are facing the prospect of a third displacement.

Since Hurricane Sandy, the family of six — including twin 16-year-old daughters and two dogs — has lived in winter rentals. Their current lease expires June 1, not long after the start of the summer tourist season.

Meanwhile, the Graggs’ Brigantine home is not only uninhabitable due to water damage but is on lifts 9 feet in the air due to new flood elevation standards.

“Worst case scenario: It’ll be June and I can pitch a tent in my backyard,” said Teri Gragg, an elementary school teacher who’s managed to salvage her sense of humor amid the chaos.

As for the girls: “They’re going to have to have their own tent — they’d kill each other.”

Five months after the storm, 535 people statewide are still living in motels through a temporary housing assistance program, according to the latest Federal Emergency Management Agency statistics. And those figures don’t include families such as the Graggs, who may soon find themselves in a precarious situation.

South Jersey will face a major housing shortage this summer as residents displaced by Hurricane Sandy jockey with summer visitors for a place to live.

“It’s going to be tough for some people, and they’ll probably fall through the cracks,” said Bill Warner, a chaplain at the Atlantic City Rescue Mission.

At any one time, the mission houses about four extra families affected by the storm. Finding permanent housing for them is already difficult, Warner said, and the situation will likely worsen with the summer influx of temporary workers and tourists. The mission is preparing for a major uptick in need.

“These people have FEMA running out and they can’t get back into their homes,” he said. “Where are they going to live?”

One of the hardest-hit groups is low- and middle-income renters, who already faced a dearth of affordable housing before the storm.

Nearly half of all New Jersey FEMA registrants reported an annual income of less than $30,000, according to a recent study by the housing advocacy group Enterprise Community Partners. About 43 percent were renters, who typically don’t have their possessions insured.

In Atlantic City, renters accounted for 65 percent of all federal aid applicants. Of those 5,975 renters, 84 percent reported annual income of less than $30,000.

But the poor aren’t the only ones displaced by the storm. In all, FEMA has registered at least 258,587 households and disbursed more than $373 million in individual assistance funds. And those figure will continue to grow until the April 1 deadline.

FEMA spokeswoman Robin Smith said about 65 new applications are filed each day as people discover — many months after the storm — that they need help. Circumstances can change, she said, leading to unexpected family crises.

“A common thing we see in disasters is that a family member will help out for a while ... and maybe they weren’t in a housing problem,” she said. “But if the stress is causing problems, they need to call FEMA back.”

FEMA is still housing 118 people in motels in Atlantic County, 19 in Cape May County and 263 in Ocean County, Smith said. Many of them either have been displaced from temporary situations months after the storm or have disabilities that make it hard to find permanent housing. The expiration of housing vouchers has been pushed back several times, with the latest deadline set for March 23.

Regardless of the situation, Smith said anyone who experienced storm-related damage should register with FEMA.

“If you wait until after the deadline, we can’t help you,” she said.

One invisible deadline is June 1, the date when the region’s rental properties start to fill up with vacationers. This year, resort communities are ramping up their marketing, trying to attract summer visitors scared away by Sandy. Billboards hundreds of miles away advertise that South Jersey’s beaches are open for business.

Dennis Allen, of Brigantine’s Ashore Realty, said he’s seeing about the same demand as this time last year — in part because of the persistent misconception that the region’s beaches and boardwalks were ravaged by the storm.

“I’ve heard from renters up north that people are going farther south, to places like North Carolina,” he said. “There are some people out there that don’t know our beaches are in good condition.”

But that could change as summer approaches, since some vacationers wait until the last minute to book their rentals, Allen said.

In Sandy’s immediate aftermath, Ashore — like a number of real estate firms — helped place about 40 families in short-term winter rentals. But, for families who still can’t return to damaged homes, the placements haven’t translated into a long-term solution since many of the homes belong to summer-only residents or landlords who rely on the lucrative summer renters.

“One lady I know is buying a house offshore, and another is moving in with a relative,” Allen said. “The owners are either renting the houses out or live in them for the summer — most rentals already have weeks booked.”

The Graggs, for instance, started out in a small apartment before securing a house with separate rooms for their daughters. During that time, the family has spent three to five hours a day on the phone, trying to navigate the frustrating labyrinth of FEMA and insurance.

“The amount of paperwork is incredible,” Teri said. “It’s not a good thing my husband’s unemployed, but we’re blessed I can go to work and he can focus on this.”

Many of the places that housed families in crisis, such as the West Atlantic City motels along the Black Horse Pike, have been shuttered since the storm. And with more families facing potential displacement, Sandy’s continued impact on housing could ripple outward across the state.

“The fact that people have to go to Lindenwold (Camden County) to find an apartment and ride the rail to get back and forth to work is an outrage,” said the Rev. John Scotland, who runs Sister Jean’s Kitchen in Atlantic City and serves as pastor to Brigantine’s Community Presbyterian Church.

Scotland said the families most at risk of displacement will be the working class, especially those tied to the casino industry.

“People making $9, $10 or $11 an hour can’t afford a house or apartment here because there’s no housing in that particular price range,” he said.

The summer will present new problems, Scotland said, although the weekly rentals tend to be different from yearly ones.

Smith said people displaced by Sandy have options, although they won’t necessarily help everyone.

Those waiting for insurance payments can take out a low-interest disaster loan through the Small Business Administration to tide them over. Meanwhile, those with land available to them can apply for a temporary housing unit, known pejoratively as “FEMA trailers,” to set up residence.

“You can’t put it on property that will be back in a flood zone, but if you or a relative has property ... that is an option,” she said.

Gragg said she’s thankful for the help she’s received so far and hopeful her home can be ready to move back into by June 1.

“We’ve been displaced for four and a half months,” she said. “We want to go home real bad.”

But she’s also realistic.

“We’re not going to put all our eggs in that basket, based on our whole experience,” she said. “Things don’t happen in week intervals; they happen over large chunks of time.”

Teri Gragg said a friend has offered to take her family in as a last resort.

And there are always the tents.

Contact Wallace McKelvey:

609-272-7256

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