As Hurricanes Intensify, Dense Coastal Cities Face Billions In Reconstruction Costs
As the Atlantic hurricane season begins, more than 31 million single-family homes and almost 1 million multifamily homes are at moderate or greater risk of hurricane wind-related damage in the U.S., according to the latest annual hurricane report from CoreLogic.
Of those at risk of wind damage, almost 8 million homes also have direct or indirect coastal exposure and subsequent risk from coastal storm surge and damage from hurricanes. Those communities will also be more sensitive to the effects of climate change, the report said.
June 1 marks the start of the Atlantic hurricane season, which will run until Nov. 30. The U.S. National Oceanic and Atmospheric Administration has predicted 14 named storms, seven hurricanes and three major hurricanes for 2021.
CoreLogic said climate change is affecting hurricane season and its impact on the U.S. Some of the changes in hurricane risk include sea-level rise, increased tropical rainfall rates, increasing storm frequency rates and a rising proportion of storms that will reach very intense levels.
“As hurricanes grow stronger, property losses will continue to mount and the insurance industry will see increased financial implications as wind damages are covered by standard homeowners insurance policies,” the report said.
New York City has the highest number of homes at risk from hurricanes, reflecting the city’s density. The CoreLogic report found 781,823 single-family homes and 108,607 multifamily homes are at risk from storm surge damage, while 3,378,397 single-family homes and 448,051 multifamily homes are at risk from hurricane wind-related damage.
Miami has the second-most number of homes under threat. CoreLogic found that 738,994 single-family homes and 28,747 multifamily homes are at risk of storm surge damage, while 1,997,608 single-family homes and 61,458 multifamily homes are at risk of hurricane wind damage.
Population densities affect risk assessment, as a lower category hurricane in a densely populated metro area is likely to do much more damage than a higher category storm in a less densely populated area, according to the report.
Houston, which is a frequent landing site for significant storms, made the top 15 list for the number of single-family homes at risk from storm surge and wind damage, but it did not make the list for multifamily because of its lack of density.
CoreLogic also performed an analysis of reconstruction cost values for both single-family and multifamily properties across the metros. Those figures estimate the cost to completely rebuild the existing structure, assuming total destruction.
As it has the largest number of homes at risk, New York City also has the biggest reconstruction cost values: $304.5B to rebuild houses from storm surge damage and $1.43 trillion for wind-related damage. For multifamily units, the reconstruction cost value is $52B for storm surge and $213.8B for wind-related damage.
Single-family and multifamily properties in the top 15 U.S. metropolitan areas account for 68.3% of the surge risk reconstruction cost value total in the U.S. in 2021, the report found.