by Matt Barbato | Gateless
Home prices in areas most prone to natural hazards are rising substantially, according to a report from ATTOM Data Solutions.
The median price of a house in cities with the highest risk of a natural disaster more than doubled in the last five years, according to the report. The report indexed the risk of natural disasters in more than 22,000 cities and evaluated housing trends in 3,441 cities.
Home prices rose 65% in the riskiest cities in terms of natural hazard risk. On the other hand, home prices rose by only 32% in lower risk cities.
The study reports there are nearly 14 million single-family homes and condos in areas categorized with a “very high,” natural disaster risk rating. The average value of those homes is $538,000. There are about 9.5 million homes in cities given “very low,” risk ratings by ATTOM and the average value of those properties is $270,336.
The demand for homes in these dangerous locations is still high despite the inherent risk. Homeowners in cities within the highest risk areas have a 32% home equity stake on average while lower equity owners in low-risk cities only have a 21% equity stake. ATTOM also says homeowners in these highly hazardous spots have been homeowners for a longer period of time on average than those in less risky locations.
According to the study, the cities with populations of at least 500,000 that had the highest natural hazard safety risks were Oklahoma City, San Jose, Los Angeles, Bakersfield, and Seattle. The safest cities with those same parameters were Philadelphia, Phoenix, Buffalo, Orlando and Brooklyn.
This report comes after Hurricanes Harvey and Irma did serious damage to Texas and Florida, respectively. A new hurricane, Maria, is currently ravaging the Caribbean and has a slight chance of making landfall in the United States.