Rising Home Insurance Premiums Are Eating Into Home Values
Climate Crisis' Hidden Cost
Since 2018, a shock in the home insurance market has meant that homes in U.S. ZIP codes most exposed to hurricanes and wildfires sell for an average of US$43,900 less than they would otherwise, the research found. This is in addition to significant visible increases for insurance.
Rising home insurance premiums, driven by climate change, are causing significant financial strain on homeowners in disaster-prone areas, leading to decreased home values and affordability issues. Research indicates that homes in high-risk areas are selling for thousands of dollars less due to increased insurance costs, with some homeowners facing unaffordable premiums and others opting to self-insure. The reinsurance market's rapid changes have exacerbated these issues, making it difficult for many to maintain their homes and affecting the broader real estate market.
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