Insurance Costs Affecting Housing Affordability

• The economy is shifting and we are watching everyone's budgets changing.

  
  

  If you are considering a move, make sure you are considering more than just the mortgage payment. Insurance costs, personal & property taxes, HOA or COA costs, local taxes, and utilities all can affect your affordability.

  
  

  Insurance has been a major focus of research this year. Keep yourself educated and ask questions!

  
  

  Insurance Challenges Nationwide:

  • Cyndee Haydon and Steven Moreira highlight the significant insurance costs and uncertainties faced by homeowners and real estate transactions nationwide.
  • Rising insurance premiums and disruptions in real estate deals are observed across various states, not just limited to Florida.

• Impact on Real Estate Transactions:

  • Anthony Friedman recounts a scenario where insurance costs disrupted a client's plans to retire to Florida, leading to delays and complications in the sale of their Maryland home.
  • Insurance challenges have become primary concerns in the real estate industry nationwide, attributed to factors such as weather events, fraud, and reinsurance costs.

• Contributing Factors to Rising Costs:

  • Insurance fraud, particularly through Assignment of Benefits transfers, has led to substantial underwriting losses for insurers.
  • Reinsurance costs have surged due to factors like the COVID-19 pandemic, climate change, and natural disasters, impacting consumers across the country.

• National Impact:

  • While Florida faces severe insurance challenges, other states like California and Colorado also experience significant increases in premiums and limitations on coverage.
  • Legislative efforts to cap rate increases may lead to insurers pulling out of certain states, exacerbating the problem nationwide.

• Positive Developments:

  • Recent legislative changes nationwide aim to address insurance fraud and stabilize rates, leading to positive trends such as increased insurer investment capital and decreased lawsuits against insurers.

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