Hurricane Laura puts 432K homes worth $88 billion at risk
Damage from Hurricane Laura's surge could potentially devastate 432,810 residential properties totaling over $88.6 billion in reconstruction cost value across Texas and Louisiana, according to CoreLogic.
But those estimates assume an expected landfall as a Category 3 hurricane. On Wednesday morning, the National Weather Service said the hurricane had already reached Category 3 and could rise to Category 4 by the time it makes landfall Wednesday night. In that scenario, the numbers increase to worst-case highs of 496,966 homes and $125 billion. It would go down to 223,573 and $44.2 billion as a Category 2.
Projections show Laura reaching the Gulf Coast by Wednesday night and moving inland by Thursday morning.
"The coincidence of two catastrophes — a damaging hurricane season and the ongoing global pandemic — underscores the importance of the correct valuation of reconstruction cost, one of the core tenets of property insurance," Tom Larsen, principal of insurance solutions at CoreLogic, said in a press release. "Homeowners, mortgage lenders and insurers need to work together to ensure properties are fully protected and insured. CoreLogic data has found a correlation in mortgage delinquencies and catastrophes, which could point to a serious issue of underinsurance trends."
Hurricane season could bring about an entirely new wave of distressed loans needing to be addressed in addition to mortgages under the coronavirus-related moratoria.
In the Category 3 scenario, the Houston metro area has both the highest amount of at-risk homes and reconstruction costs facing surge damage at 126,343 properties and just over $26 billion. Beaumont-Port Arthur, Texas, follows with 77,789 properties and $14.1 billion in value. The Houma-Thibodaux, La., housing market is next in line with 74,112 homes at risk worth $15.3 billion in RCV.