The risk of natural disaster doesn’t seem to discourage home buyers from paying top dollar, according to a new study. In fact, homes in areas with a high risk of disaster tend to cost more
The risk of natural disaster doesn’t seem to discourage home buyers from paying top dollar, according to a new study. In fact, homes in areas with a high risk of disaster tend to cost more.
Housing analystics firm RealtyTrac recently released its first Natural Disaster Housing Risk Report, rating more than 3,000 counties on their risk for hurricanes, tornadoes and earthquakes. The study labeled counties as Very High Risk, High Risk, Medium Risk, Low Risk and Very Low Risk.
Only 373 counties fell into the Very High Risk category. Those counties contained only 8% of total U.S. housing units. Meanwhile, 271 counties – and just 3% of total U.S. housing units – fell into the Very Low Risk categories.
The biggest percentage of U.S. counties and housing fell into the High Risk category. 1,118 counties were classified as High Risk, along with 47% of U.S. housing units.
The potential risk of a natural disaster may not be the first item on most homebuyer checklists for a dream home, but prudent buyers will certainly take this into consideration along with myriad other factors that could affect home value,” said Daren Blomquist, vice president at RealtyTrac. “In the past natural disaster data was technically available, but difficult for buyers and homeowners to dig up; however, now the data is readily available online for virtually any U.S. property, and buyers should take advantage of this.”
In fact, home buyers tend to pay a premium for housing in high-risk areas; in more populous counties, median home prices are 41% higher in high-risk areas than in the rest of the market, according to RealtyTrac.
“The higher median home prices in many counties with a high risk for natural disaster indicates that other location-based factors such as weather and access to jobs override concerns about home damage as a result of earthquakes, tornados and hurricanes,” Blomquist said.
Housing analystics firm RealtyTrac recently released its first Natural Disaster Housing Risk Report, rating more than 3,000 counties on their risk for hurricanes, tornadoes and earthquakes. The study labeled counties as Very High Risk, High Risk, Medium Risk, Low Risk and Very Low Risk.
Only 373 counties fell into the Very High Risk category. Those counties contained only 8% of total U.S. housing units. Meanwhile, 271 counties – and just 3% of total U.S. housing units – fell into the Very Low Risk categories.
The biggest percentage of U.S. counties and housing fell into the High Risk category. 1,118 counties were classified as High Risk, along with 47% of U.S. housing units.
The potential risk of a natural disaster may not be the first item on most homebuyer checklists for a dream home, but prudent buyers will certainly take this into consideration along with myriad other factors that could affect home value,” said Daren Blomquist, vice president at RealtyTrac. “In the past natural disaster data was technically available, but difficult for buyers and homeowners to dig up; however, now the data is readily available online for virtually any U.S. property, and buyers should take advantage of this.”
In fact, home buyers tend to pay a premium for housing in high-risk areas; in more populous counties, median home prices are 41% higher in high-risk areas than in the rest of the market, according to RealtyTrac.
“The higher median home prices in many counties with a high risk for natural disaster indicates that other location-based factors such as weather and access to jobs override concerns about home damage as a result of earthquakes, tornados and hurricanes,” Blomquist said.
