In recent years, rising prices have been a pain point for many consumers.
When it comes to the housing market, one major concern is reportedly contributing to not only expensive home prices but also sky-high insurance rates that could increase the risk of homelessness for many Americans.
According to openDemocracy‘s Chrissy Stroop, the nonprofit First Street Foundation found that dangerous weather events make it difficult for many to buy affordable insurance for their residences and may contribute to climate-related migration.
Notably, California — the state with the largest population in the United States — saw a 335% increase in buildings destroyed by wildfires since 2009, with a nearly 800% uptick in denials to renew insurance in high-risk areas between 2015 and 2021.
The search for safety and affordability — including an exodus from California — also seems to be driving up home prices.
“In high-risk areas, decreased demand for properties might result in declining real estate values, and, conversely, urban centers experiencing an influx of residents may experience increased demand for housing, leading to rising property values,” the report said, per openDemocracy.
Why is this trend concerning?
Extreme weather events are expected to grow in intensity and frequency because of the warming temperature of our planet caused by human activities, which could exacerbate the cycle of rising insurance rates, housing costs, and homelessness.
This year’s State of the Nation’s Housing report found a record 21.6 million renter households were “cost-burdened.”
For residents living in risky areas, the inability to obtain insurance could hinder recovery efforts after natural disasters, with some insurers pulling out of certain states or not adding new customers.
What’s being done about the housing crisis?
State and local governments are taking action by passing incentives that support the construction of more affordable housing, while the federal government has also stepped in.
In September, the U.S. Department of Energy allocated $400 million for states to invest in climate-resilient buildings and energy efficiency.
In the meantime, individuals can do their part by investing in the health of our environment.
Air-drying clothes, for example, could help households save money on electricity while reducing the amount of harmful carbon pollution they each contribute to the atmosphere on average by 2,400 pounds annually.
Join our free newsletter for easy tips to save more, waste less, and help yourself while helping the planet.