218: These “Subtle Risks” Could Have Astronomical Impacts on Real Estate Expenses w/John Sheffield
On The Market
Shownotes Transcript
Owning real estate could get expensive—yes, **even more expensive **than it already is today. Insurance prices), property taxes, maintenance costs, and more are going through the roof, and there isn’t much stopping these costs from jumping even more. **What’s accelerating the rise in these upkeep costs? **Hotter summers, colder winters, and more natural disasters. Growing climate risk) is making real estate deals harder and harder to pencil, and **even some safer areas to invest are seeing sizable pricing upticks. **
John Sheffield from ICE) brings us the latest data on the** financial impacts of climate risk** in this episode. When we say “climate risk,” we know what you’re thinking: hurricanes, tornadoes, and wildfires. But that doesn’t even scratch the surface of what’s causing real estate expenses) to jump. Areas of the US with once-cool summers are now experiencing record-breaking heat, increasing hail damage is denting roofs and breaking windows, and flooding has become the norm. These subtle climate effects have huge implications for your bottom line. So, what should you do to secure the profit you’re looking for on your next property?
John hits on the expenses that are rising the most, the areas where **home upkeep costs could **almost mirror monthly mortgage payments, and what investors must do when underwriting) their next deal to account for this massive jump in expenses.
In This Episode We Cover
**The actual cost of climate risk **and the expenses that are seeing the most significant pricing surges
Why even **areas **without hurricanes, fires, or tornadoes are still **at significant risk **
Property tax)** problems **and underfunded local governments that could quickly raise taxes
Insurance underpricing that could lead to even more expensive home protection
Areas **where home prices could drop **as a result of inflated home expenses
Where to find and track climate data so you know **where (and where not) to invest **
And So Much More!
Links from the Show
Join the Future of Real Estate Investing with Fundrise)
Connect with Other Investors in the “On The Market” Forums)
Subscribe to The “On The Market” YouTube Channel)
Growing Home Insurance Costs Will Destroy Your Cash Flow—Here’s What You Can Do About It)
Jump to topic:
(00:00) Intro
(01:31) Costly Climate Risk
(07:56) A Huge Insurance Problem
(14:31) Property Taxes and Utility Costs
(20:38) Maintenance Inflation
(22:54) What Investors Must Do
(25:22) Prices Could Drop Here
(30:08) Where to Find Climate Data
Check out more resources from this show on BiggerPockets.com) and https://www.biggerpockets.com/blog/on-the-market-218)
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