This is a repost from the September 15th An Email By Steve
Last year, a couple clients of mine said they wanted to purchase a fixer-upper, not something they necessarily needed a renovation loan for, but something they could move into and tinker with. And this past January, we closed on a house—barely.
I always send my people to Portsmouth Atlantic Insurance because 1) their business development person is AMAZING—here’s looking at you Kaleigh, if you’re reading. And 2) they saved me $900 a year on auto insurance. That’s not sneeze at money.
So I sent my clients to Portsmouth Atlantic, and Kaleigh called and said they couldn’t cover the house.
Interestingly, the refrain I’ve heard since I’ve been in real estate is that New Hampshire has the oldest housing stock in the nation. Except, we really don’t.
New York State has the oldest housing stock in the nation, coming in with a median age of 63 years. Rhode Island comes in a close second at 60 years. Mass(holes) 59 years. Connecticut 55 years, Maine 45 years.
The average median age of housing stock across U.S states is about 42 years, and New Hampshire falls nicely right into that category. We are average. Well, a little bit above average at 43, but still.
That being said, the oldest house in Ohio that people still actively live in is the 1804 Betts House.
The house my clients moved into was built in 1782. When I asked Kaleigh why Portsmouth Atlantic couldn’t insure the house, she said the house was just too old.
Not being able to secure insurance threatened the entire deal. No way a bank was going to loan my clients money for a house that couldn’t be insured.
My first strategy was to find out who the seller’s had for insurance, so I called their agent, got a phone number, and was shocked when that agency said the policy was up in a month, and they were dropping the house like a hot potato. Even more surprising was that the sellers had no idea.
In the 1980s, we had three natural disasters. An entire decade and only three natural disasters? In 2023, just last year, we had 28 disasters that caused more than 1 billion dollars in damages. Two and a half million people were pushed out of their homes due to storms and fires. If you don’t believe in climate change, fine, I know that’s a weird political issue, and you can get angry and quite defensive when you hear the term climate change. Fine, that’s perfectly fine. Whatever. The point here is that even if you don’t believe in climate change, insurance companies do. Economist Kyla Scanlon has reported that “the five large U.S. property insurers, including Allstate, American Family, Nationwide, Erie Insurance, and Berkshire Hathaway have told regulators that extreme weather patterns caused by climate change have led them to stop writing coverages in some regions, exclude protections from various weather events, and raise monthly premiums and deductibles.” You can watch the entire 20 minute report here.
Although Scanlon focuses in on the states that are affected most by severe weather—Florida, California—everyone else still feels safe because the weather isn’t really happening in our own backyards, or at least that’s our perception. In The Daily, Christopher Flavelle investigates how climate-related disasters are spreading throughout the U.S, even to states in the Midwest and Southeast. Formerly “minor” events like hailstorms and windstorms are occurring at a more frequent rate. And although Flavelle concentrates on the Midwest, maybe you remember the April winter storm that left more than 230,000 New Hampshire customers without power. Or how about the Hampton high tide flooding? Or, another example, Route 140 in Alton?
“…previous annoyances are becoming real threats to insurers,” said Flavelle.
There are steps you can take to help protect your home and attempt to keep insurance rates down. Hardening is a strategy that involves making homes more resistant to damage from weather. You can, for example, install shatter-resistant or impact-resistant windows. Add storm shutters. Move your electrical panel from your basement to somewhere higher in the house. Build retaining walls or French drains.
Of course, some properties are so vulnerable that even hardening won’t be enough to make them insurable. Additionally, the cost of hardening homes can be prohibitive.
You know, I found home insurance for my clients through Cross Insurance. It took a lot of phone calls, and I mean a lot of phone calls. And if it hasn’t been for Kaleigh at Portsmouth Atlantic, I would have never found Cross. I’ve also learned my lesson. When you’re home hunting, and you find a property you want to put an offer on, find out if you can insure the thing first before you get too far along in the process. And, if you already own a home, you might want to give your insurance company a call.
