Analysts at CoreLogic, a global provider of property information, analytics, and data-enabled solutions, have released a new report which reveals that over 14.5 million single and multifamily homes were impacted by the largest natural catastrophe events of 2021, with an estimated $56.92 billion in property damage.
The report looked at thirteen major hazard events of 2021, ranging from hurricanes and severe weather such as tornados and hailstorms to wildfires and winter storms, in order to understand how these events have disproportionate yet wide-sweeping effects on properties.
The analytics company analysed over 120 million residential structures in the U.S. and took a closer look at defining impact.
Property impact varies by event, while a wildfire has the potential to consume an entire property, there may also be damage caused by smoke, ash and odor to the neighbouring structures that remain standing.
Because risk comes in various degrees, any sort of property damage can have a compounding effect on the homeowner and economic stability.
Due to natural disasters increasing in frequency and severity, the impact on regions underprepared to handle an economic disruption, job displacement and the destruction of real estate assets can be devastating, leaving community members unable to pay their mortgages or afford reconstruction costs.
The report analysed an area like Houma, Louisiana, which was hit head-on by Hurricane Ida, a category 4 hurricane, in August 2021. At the time of impact, delinquency rates hovered around 7.4%. The following month, the delinquency rate nearly doubled to 13.3% and hit 13.5% in October.
While recovery after a natural catastrophe continues well after the walls are rebuilt, it’s important for insurers, mortgage and financial professionals to harness technology and better anticipate the possible severity of potential disasters.
The analysts noted that such preparedness can be meaningful to protecting homeownership, insurer portfolios and shielding the housing stock from collapse
Tom Larsen, CoreLogic’s principal, Industry Solutions commented: “By leveraging granular data for the increasing frequency and severity of catastrophes, we are able to see that more than 14.5 million homes were impacted to some degree by natural hazards in 2021. That’s about 1 in every 10 homes in the United States.
“Insurers and lenders can leverage the latest technologies and work cross-functionally to better understand this risk, protect homeowners and enable faster recovery times.”
