Multifamily developers in coastal areas are expecting big increases in insurance costs this year, according to a report by Yardi Matrix.
In Texas and Florida, where Hurricane Ian caused $50 billion in damage last year, insurance costs are nearly 50% higher than in 2022. Some property owners could face far higher increases, though.
An executive with the largest affordable developer in Florida is bracing for 200% to 300% price spikes, according to a report by Multifamily Dive. Such great leaps in insurance costs threaten new development and property sales, Yardi Matrix says.
Yardi Matrix noted that increases in construction costs from inflation, labor, and supply chain issues along with the growth in property values are driving higher insurance costs.
Yardi Matrix added: Not only are costs increasing but insurers are covering less wind limit on replacement costs with large increases in deductibles, new exclusions for damages such as mold or flood endorsements, and limits on payouts. That forces property owners to layer wind on top of other policies to reach the replacement cost values required by lenders.
Related Stories
Multifamily Housing | Apr 23, 2019
Recharging Edison’s batteries
America’s greatest inventor would have appreciated this project team’s ingenuity and persistence.
Multifamily Housing | Apr 17, 2019
Multifamily real estate trends for 2019 and beyond
Boomers are on the move and Millennials are seeing upward mobility, but issues with affordability and housing product mix persist.
Multifamily Housing | Apr 16, 2019
Multifamily rentals are still alive and kickin’
Apartments are being built, and in goodly number. But not enough of it is affordable.
Multifamily Housing | Apr 12, 2019
NYC officials partner with nonprofit to build modular affordable housing
Thorobird and BACDYS partner with Brooklyn’s FullStack Modular on project.
Multifamily Housing | Apr 11, 2019
St. Augustine Terrace brings affordable housing to the Bronx
Magnusson Architecture + Planning designed the building.
Multifamily Housing | Apr 8, 2019
Priced to sell: DUMBO condo development offers starter units in luxury setting
Designed by ODA New York, 98 Front Street will be loaded with amenities like a salt water pool, co-working spaces, and indoor and outdoor fitness centers.
Reconstruction & Renovation | Apr 5, 2019
Historic Corrigan Tower in Dallas becomes 1900 Pacific Residences
The 18-story Corrigan Tower in the Dallas’s historic downtown district is now a thriving 150-unit apartment residence community.
Multifamily Housing | Apr 3, 2019
Multifamily rent growth hits two-year high in February, rising 3.6%
A survey of 127 major U.S. real estate markets by Yardi Matrix shows no signs of slowing for multifamily rental demand.
Multifamily Housing | Apr 3, 2019
New multifamily development rises in Summerville’s Nexton mixed-use community
The new complex offers easy access to I-26.
Multifamily Housing | Mar 24, 2019
New York’s largest office-to-condo conversion nearing completion
One Wall Street will feature 100,000 sf of amenities and a three-level Whole Foods.
