According to the latest RealtyTrac Natural Disaster Housing Risk Report, approximately 10.6 million homes, about 8% of the market, are at a very high risk of being affected by natural disasters. The report looks at the natural disaster risk to more than 3,000 counties throughout the country, before assigning a natural disaster risk score.
It rated 373 counties that were mainly in the South, Midwest and Eastern seaboard as being at high risk. Apparently the report assesses the risk for three different types of natural disasters which are earthquakes, hurricanes and tornadoes. Just 3.9 million homes, which equates to 3% of the total housing stock in the United States were categorized as being very low risk. The majority of homes fall into the high risk category. This equates to 61 million homes or 47% of the market.
The article in Realtor.org points out that many home buyers may not think about checking to see if their new property falls into a high risk category for natural disasters, but it is well worth doing so, alongside many other factors that could affect the value of their property. Up until fairly recently, this type of data on natural disaster risks was available, but wasn’t easily accessible. Nowadays anyone with access to the internet can readily dig up this information. Real estate experts advise potential buyers to take advantage of this information.
Even though certain areas are at greater risk of being affected by natural disasters, it doesn’t seem to deter buyers from purchasing these homes. The median price for homes in counties with a low or very low risk of being affected by natural disasters averaged $161,000 in April 2014, but in comparison the median price for homes in high risk areas was $377,483. Apparently this disparity is likely to be due to other factors such as job availability and weather as this can outweigh concerns over homes being damaged as a result of natural disasters.
Counties at low risk of being affected by natural disasters include Dallas Tarrant County in the Dallas-Fort Worth metro area, Bexar County, Texas, Sacramento County, California, and Allegheny County in the Pittsburgh metro area. The county with the lowest risk was Hennepin County in the Minneapolis –St Paul metro area. For those that are interested, RealtyTrac has an interactive heat map showing natural disaster risk levels county-by-county. In addition, the company has a website showing the natural hazard risks for 110 million homes throughout the nation.