Various parts of the country have dealt with a higher than normal amount of natural disasters in recent years. Whether it is destructive hurricanes along the Atlantic and Gulf coasts or devastating wildfires in California, the real estate market may be reacting. For example, homes in high-risk flood areas appreciated about 5% less than homes in low-risk areas over the past five years. For homes in fire-risk areas, it was 3% less. A recent Realtor.com analysis shows that properties in such areas will likely see 5% less price growth in 2021 than homes in similar areas at low risk of natural disaster.
Over the past five years, homes with severe or extreme risk of flooding in 78 coastal counties with hurricane-related disaster declarations saw a sales price growth per square foot of 25%, according to the Realtor.com analysis. That compares to 29% for homes with moderate or major risk and 30% for homes with minimal or low risk.
So does this mean buyers will begin avoiding areas such as Florida and California? We do not believe this to be the case at all. As a matter of fact, Florida continues to be one of the most popular states for Americans to relocate to. With this said, buyers should be aware of items such as flood risk and a home’s hurricane protection prior to any purchase. Given the recent active hurricane seasons, many of the homes in South Florida have been built or modified to be prepared for the impact of tropical cyclones.
If you are new to South Florida, it is highly recommended that you are represented by local and knowledgeable real estate professional. At Live South Florida Realty, Inc. we have assisted many clients with their relocation to South Florida. Contact us today to get started!