Wednesday, April 29, 2020 / by Vanessa Saunders
From Vanessa Saunders, MBA, MIMC , Broker Owner, Global Property Systems Real Estate.
In Global Property Systems Real Estate's first year in business, we were struck by Hurricane Sandy. Our home and office were rendered permanently uninhabitable due to flooding. According to our homeowners insurance, damage from "wind driven water" wasn't covered.
Thinking back, it would have been good to know how "at risk" we were in that location when we purchased the house. Every home in America is at risk for some kind of disaster, whether it's a hurricane, earthquake, nuclear power plant radiation or the spread of COVID-19. A new tool from a start-up called Augurisk allows members to plug in an address anywhere in the United States and get a ranking of what the major risks are for that location and how severely it may affect your life.
When buyers apply for 30 year mortgages, they don't know what's likely to happen to their home years from now. The platform pulls the best available data from multiple sources to calculate risk scores for several types of disasters, including wildfires, coastal flooding, hurricanes and other storm events, earthquakes, volcanoes, along with social risks like air pollution, radiation, and socio-economic risk, which is calculated based on factors like income inequality, educational attainment, and the local poverty rate. The COVID-19 risk score looks at current local cases and fatalities and the number of available hospital beds.
A report for each property breaks down the individual risks, and then assigns a “global” risk score that takes all of them into consideration. The riskiest place to live in the country: A census block near the water in St. Marks, Florida, a location with a score of 92 out of 100 for coastal flooding (100 is worst), a score of 85 out of 100 for hurricanes, and a score of 83 out of 100 for wildfires. On July 10, 2005, the storm surge associated with Hurricane Dennis severely flooded the town, causing major damage to local businesses and homes. (A series of census blocks along the coast of North Carolina is even riskier, but already unoccupied.)
Disasters in the United States seem to be on the rise, especially those related to global warming. Last year's California fires, Hurricane Dorian and Tropical Storm Imelda, plus eight severe storms and three major flooding events cost upwards of $45 billion dollars to American property owners and insurance companies.
We managed to bounce back from our hurricane disaster, although it took years to recover financially. I'm not sure if knowing our risk rating would have changed our thinking when we bought the house, but going forward, environmental disaster risk will always be a consideration.
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Ask the readers: Would knowing your disaster risk rating be enough to stop you from buying a home? Tell us HERE.