Calif. Wildfires could have long-term implications on real estate

Calif. Wildfires could have long-term implications on real estate

Calif. Wildfires could have long-term implications on real estate
The life-threatening danger posed by the wildfires ravaging California could have a long-lasting impact on the states housing market. CalFire, California’s fire-fighting agency, reports that nearly three million of the state’s 12 million homes are current at risk due to wildfires. In the era of the coronavirus, finding a way for these tens-of-millions of Californians to safely evacuate more challenging than ever.

The destruction of homes in the Golden State is expected to hurt home values in heavily impacted markets. Moreover, even those who aren’t in the line-of-fire, are likely to see their insurance premiums rise, again. After 2018’s devasting wildfire season, the worst recorded in state history, many insurance companies pulled out of the state altogether, refusing to provide new coverage to homeowners and even leaving behind existing policies.

Damage caused from wildfires in California over the last few years has topped $30 billion. As temperatures continue to set new records, the cost associated with rebuilding the state is expected to climb as well.

Today, conforming no-point 30-year fixed mortgage rates are averaging 2.875 percent and 15-year rates are near 2.5 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.