Real estate always goes up in value right? Well maybe so but will we reach a point of no return?
The David Green Show on YouTube has an excellent video on something I’ve been talking about here, here, here, and here. The topic is insurance and it is beginning to hit critical mass that could end up destroying real estate as we know it.
If you own real estate in any way, shape or form you should watch the whole video.
The crux of the issue is that in order to obtain a mortgage on real estate, banks require you to carry insurance on the property but if insurance premiums are too high they make it difficult to afford a property.
But the problem doesn’t stop there, insurance companies are leaving states with high risk which lowers competition and enables the few insurance companies left behind to hike rates.
The three states hardest hit now are California, Florida and Texas. A few insurers have left these states and with the recent hurricane Helena causing massive damage in the east coast, expect more insurance companies to bail out too.
Florida Socialism
The State of Florida, or at least one of it’s reps, wants to make everyone across the United States pay for Florida’s insurance woes. Florida rep Jared Moskowitz has filed legislation that would “spread the risk around” using federal bonds to mitigate the insurance burden.
Ironically, I was working on a post about the future feasibility of owning property rentals if the insurance and valuation trend continues. “It’s making everyone poor!” is a great quote from the video above.
Share The Wealth
What do you think? Are you having a problem with sky rocketing insurance premiums for your home or auto? Do you want to pay for Florida’s insurance issues and subsidize them so YOU pay for THEM? Let me know in the comments below.
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