Beyond the Buildings

Environmental risks are accelerating in ways the housing market can’t ignore. At the same time affordability pressures and insurance challenges are reshaping where and how Americans can live.

- Natural disasters are starting to influence people’s choice of home. Part of it is safety. A lot of it is price. Still, awareness has not yet tipped the scales, and people continue to move to these popular, but risky, regions.

- There are signals that people are shifting where they're migrating to. Just look at Florida where the number of new arrivals has slowed in recent years.

- Investing in resilience measures before a disaster strikes can help ease the financial burden of a catastrophe. But how much depends on when — and where — you make that investment.

Links:

Cotality Insights

https://www.cotality.com/insights

Climate at Cotality

https://www.cotality.com/climate

- The NASA Jet Propulsion Laboratory-Cotality report, an 18-month effort, provides a structural risk assessment, projecting potential loss from perils over 100-years.

- Cotality and NASA used digital twins to model “what if” scenarios, turning data into actionable insights for planning and resilience.  

- Property-level hazard assessments could become a standard practice for federal agencies and large institutions looking to proactively prepare their facilities for the changing environment.

Links:

Cotality Insights

https://www.cotality.com/insights

Climate at Cotality

https://www.cotality.com/climate

The U.S. housing market is facing several “spooky” challenges. Rising costs, higher interest rates, and a growing economic uncertainty are presenting a scary reality homeowners and buyers. These factors are shaping affordability and the way people approach buying and owning a home.

- Property taxes have gone up about 30% on average across the U.S. This increase amounts to roughly $1,000 a year for some households.

- Rising interest rates are a primary driver of higher rents. When mortgage rates increase, they price out potential homeowners, which increases rental demand.

- If a recession occurs, delinquency rates and foreclosures could go up, but they are currently very low.

Links:

A 13-stop tour of some of the most haunted US places

https://www.cotality.com/insights/articles/13-stop-tour-most-haunted-us-places

Cotality Insights

https://www.cotality.com/insights

Shifts in energy demand reach well beyond individual homes – touching insurance risks, utility costs, community planning, and even national strategy.

- Cotality Australia’s "Watts it Worth" report experts dive into why sustainable building choices are increasingly important to consider when assessing Australian homes.

-Homes with energy efficiency features, especially solar panels, sell for a measurable premium: 2% - 6% more in the U.S. and over 2.7% in Australia.

-Both the U.S. and Australian governments have offered incentives to promote individual solar panel use.

Links:

Watt's it worth report: https://www.cotality.com/au/insights/analysis/watts-it-worth

Resilience rebalances the foundations of property: https://www.cotality.com/insights/articles/resilience-rebalances-the-foundations-of-property

The home insurance industry’s foundations are shifting. Even with major leaps in property data and analytics, a perfect storm of more frequent natural disasters, escalating litigation costs, and market pressures is leaving homeowners and developers increasingly exposed to risk.

- There is a fault line straining the insurance industry which could trigger a housing shock with echoes of the last financial crisis.

- The traditional insurance model is struggling to adapt to a new era of escalating risks, highlighting the need for a more proactive, collaborative approach.

- Having federal programs that can standardize incentive community level resilience measures that can support individual stability will prove to be a cost savings long term.  

Webinar registration link: https://www.cotality.com/resources/webinars/making-the-shift

Find out more at Cotality.com/insights

Despite advances in technology promising speed and convenience, the complex and often confusing homebuying process leaves many buyers overwhelmed and reliant on expert guidance to navigate it successfully. 

- Cotality’s From House to Home survey found that there was an overarching lack of confidence in the homebuying process.  

- Expert advice and professional guidance remain crucial to help buyers navigate the process with confidence. 

- Technology and AI-driven platforms aim to streamline the process by anticipating preferences and speeding things up.  

Find out more at Cotality.com/insights

Demographics are set to redefine what homeownership looks like in the decades ahead.

- Current housing challenges are causing a competitive market: high prices, low inventory, and limited affordability.

- Builders face today’s housing shortage, but real opportunity lies in designing homes for tomorrow and future generations.

- Cotality projects a large growth in multi-generational households due to aging populations and the implications for senior housing.‍

Find out more at Cotality.com/insights

This episode explores the UK’s long-standing experience with energy performance data and retrofit strategies, offering valuable insights for improving home energy efficiency.

• The UK has been collecting detailed energy performance data on over 65% for decades, enabling precise property-level modeling that many other countries lack.

• Successful retrofit strategies emphasize the importance of long-term planning, data-driven decision making, and tailored approaches for homeowners, landlords, and local authorities.

• Government policies and incentives, including lessons from past programs like the Green Deal, play a crucial role in driving energy efficiency improvements and can inform future approaches in countries like Australia and the U.S.

Find out more at Cotality.com/insights

AI is becoming more involved in the homebuying process, but disconnected systems are leaving buyers confused and looking to people in order to rebuild trust throughout the process.

- Buyers are entering the homebuying process stressed and looking for guidance. Technology has promised speed, but it hasn’t delivered confidence.

- Trust in technology doesn’t map neatly to age or buyer stage. It has to do with AI literacy.

- People still want people to bridge gaps, build trust, and lead to confident decisions.

Mortgage fraud cases haven't surged dramatically, but subtle shifts in tactics and technologies are reshaping the industry.

- Under the umbrella of purchase fraud, transaction fraud risk, such as undisclosed agreements between the parties and down payment fraud, is making waves.

- While New York has long been the top state for fraud risk, California ranks in third-place, but the Golden State did show a double-digit increase in risk from the prior year.

-Fraud can delay transactions, increase costs, and even prevent first-time buyers from securing deals, eroding trust in the market.

In this episode

2:35 – An overview of fraud risk in the U.S.

5:22 – How has the rate of occupancy fraud changed over the past year

8:23 – Why is mortgage fraud so difficult to detect and how can it be mitigated?

10:35 – Has automation opened the door to new mortgage fraud vulnerabilities?

13:44 – How can big data and advanced analytics help with fraud detection?

17:53 – Erika Stanley goes over the numbers in property market in The Sip.

19:29 – How can regulation help with fraud detection and mitigation?