How hurricane season will affect American real estate

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Nearly 8 million homes worth more than $ 1.9 trillion for renovations could be hit by a hurricane in 2021, according to the agency. Hurricane 2021 Report from proprietary data analytics provider CoreLogic.

A report on single-family and multi-family homes on the Gulf and Atlantic coastline takes a closer look at how hurricane damage to property affects an owner’s ability to pay off a mortgage. It also examines the impact of hurricanes on the country’s housing supply, which is already alarmingly short.

For homeowners, the result of a financial disaster translates into a significant increase in mortgage delinquency rates for homeowners, as people affected by expenses and lost wages are unable to make monthly payments, according to the report. For example, after Hurricane Laura hit Lake Charles, the already high delinquency rate rose from 9.8% in August 2020 to 16.1% in September 2020, up 6.3 percentage points, according to the report.

“To get a 360-degree view of the impact of climate change, we looked at the US housing economy after the hurricane and saw a significant spike in mortgage delinquencies and loss of housing stock,” said Frank Notaft, chief economist. at CoreLogic. “The communities most affected by natural disasters and financial disasters are those where crime rates are already high, such as Lake Charles, Louisiana, as reflected in landfall rates before and after Hurricane Laura.”

Last week we listened to how CoreLogic hosts a webinar on hurricanes and climate change panellists discussed why hurricane risk assessment is so important for financial institutions, borrowers and entire communities.

“We have already established that 2020 and prior years have been a record financial impact for many communities,” said George Gallagher, Director, Hazard and Spatial Solutions. “I will summarize this as a key reminder that we cannot ignore the human and community impact that devastating hurricanes and other natural disasters have on borrower homeowners and the communities in which they live.”

Historically, the housing stock has been depleted after a classified storm. After Harvey, for example, in Houston, Texas, over the next five months, supply fell by 23%. Wilmington, North Carolina lost 26% of its shares in the four months following Florence in 2018. Stocks in Panama City, Florida fell 13% in two months after Hurricane Michael in 2018.

According to the authors of the report: Tom Larsen, Dr. Thomas Jeffrey, Rhea Turahia, Denise Moore, Molly Bosel, as climate change continues to affect how hurricanes occur, the risk in these hurricane-prone areas will continue to grow.
Elizabeth Greaves, Michael Bolton Smith and Jose Acosta.

“Based on data from NOAA’s National Environmental Information Centers, over the past four decades, we have seen a 70-90% increase every ten years in total inflation-adjusted losses due to weather in the United States, and this trend is not slowing. down.”

They say migration trend moving from the center to coastal cities could put more households at risk.

According to the hurricane report, these areas are generally low-lying, prone to hurricanes, and particularly affected by climatic factors, including sea level rise, extreme rainfall, and the possible intensification of hurricanes.

The resilience of these coastal communities – high or low income – continues to be a focus of prevention and preparation.

“The only way forward is to understand what is really at risk and to educate, prepare and collaborate with
everyone with an interest in the ongoing crisis, including insurance companies, lenders, government agencies and families on the front lines, “they said.

Access full reportwhich provides insight into property risks, both nationally and in urban areas through CoreLogic.com.



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