Surge in home insurance costs adding more inflation pressure on Americans
The Metaverse Institute co-founder Jason Haber discusses the impact Hurricane Idalia could have on Florida's housing market and property value on 'The Claman Countdown.'
The astronomic rise in mortgage rates and spike in home prices over the past year has pushed a key tenet of the American dream out of reach for millions of families.
Now, there is another obstacle to homeownership: higher home insurance premiums.
The average cost of home insurance for a $300,000 property in the U.S. surged 12% in 2023 to roughly $1,770 per year, according to recent data published by Insurify, an insurance comparison website headquartered in Massachusetts.
That is noticeably faster than the 2.8% increase in the consumer price index recorded during that same time period.
SURGING HOME INSURANCE COSTS COULD FORCE FAMILIES TO LEAVE THESE 10 STATES
A sign outside a home for sale in Atlanta, Georgia on Wednesday, Sept. 6, 2023. Home prices in the US climbed for a fifth month as buyers competed for deals in the least affordable market in decades. (Photographer: Elijah Nouvelage/Bloomberg via Getty Images / Getty Images)
«As a recurring cost of owning a home, albeit a relatively smaller component, surging insurance premiums could add extra cost burdens on many households in this high borrowing cost environment,» Freddie Mac economists wrote in a recent blog post about the matter.
Freddie Mac data shows the average annual home insurance premium was $1,081 in 2018 among borrowers living in a single-family home with a conventional 30-year mortgage. By 2023, that had jumped to $1,522 – a more than 40% increase from just five years ago.
The problem may soon get worse.
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Insurify
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