2022 Housing Market: Homebuyer Insurance Tips

 In Insurance Advice, Ozarks Live

Insurance Strategies for the 2022 Housing Market

Hi there! It’s John, from the Resource Center. These last few years have been full of wild insurance stories, so I wanted to take the opportunity to share some of those and help everyone take advantage of opportunities that they may not have considered. Changes in the housing market aren’t always bad–here’s how we can help you make the most of our current forecast.

Watch: 6 Must-Have Home Insurance Endorsements

Temporary Housing Strategies

Join the Airbnb Craze

We actually have a few suggestions for an Airbnb plan. If you have multiple properties, one thing you can do is register one of the homes as an Airbnb. This way, customers pay for nightly or weekly visits. Another thing you can do is list an unoccupied room or basement in your primary residence.

Airbnb’s are the dream solution for anyone who’s itching to travel. If you’ve just sold your home and aren’t ready to purchase, this might be the time to act on those dreams! You can travel around the country and spend a few days or weeks at a time living in an Airbnb. Whether you’re traveling while you work or spending time visiting with faraway friends and family, we do sell insurance for Airbnb renters and would love to help you out.

Rent until the Market Settles

This is a GREAT time to sell your home, but not necessarily an ideal time to buy. If you want to wait a few months to see what the market does, one of your options is to rent a home, apartment, duplex, or another form of housing. One thing I’d 100% recommend is to invest in renter’s insurance! Renter’s insurance is usually inexpensive and is designed to cover damages to your personal property for qualifying hazards.

Example

Here’s a story of what happened with one of my customers, who did have renter’s insurance. They were renting a duplex, and the neighbor on the other side was suddenly involved in an electrical fire. Their phone charger popped and their whole mattress was engulfed in flames. The fire spread through the walls, including the walls that connected to my client’s duplex. They were able to put it out with a water hose, but it had already done a lot of damage to both sides of the duplex. My client’s neighbor did not have renter’s insurance; all of the property that was destroyed by the fire had to be thrown out. Because my client had renter’s insurance, and accidental fires are often covered, they were reimbursed approximately $3,5o0 for the damaged property.

If neither of the tenants had the right coverage, they both would have taken a significant loss in property, which could have resulted in a lawsuit. Considering that renter’s coverage generally costs $15-$20 a month for an average living situation, this turned out to be a great call for my client.

Live Full-Time in an RV!

Another tip for the buyer’s housing market is to live in a camper or RV until you can buy. Your normal RV insurance doesn’t offer enough coverage if you’re going to live in it full-time. Standard coverage will cover the vehicle, but not necessarily property damage, bodily injury, or replacement costs. People LOVE this idea, and I can help you make it work with the right coverage. If this is something you’re seriously considering, check out these tips for RV & Camper Endorsements.

Consider a Tiny House

If you are single or have a small family, a tiny home might be a great strategy for you! We do offer insurance for a tiny house. This is a great option for anyone trying to stash money aside for college, traveling, retirement, or even your stream home. Whether you’re keeping it stationary or putting it on a trailer, make sure you’re getting the right kind of coverage to protect your tiny home from potential damage.

Considering a Fixer-Upper?

Actual Cash Value vs Replacement Cost

If you’re considering a “project house,” it’s important to understand the different types of coverage available. Actual Cash Value determines how much a property is worth. This number is calculated by subtracting depreciation (like wear and tear on the home) from the replacement cost to make repairs. Replacement Cost Coverage is the entire cost to cover your repairs. Due to the rising costs of materials, everyone’s insurance is probably going to go up a little bit this year, and possibly the next. So take that into consideration when you’re looking into a fixer-upper. Get some estimates and plan for above-average cushioning.

When You Need Vacant-Home Insurance

If you’re not going to live in a home while you’re renovating, I highly suggest getting a temporary form of coverage called Vacant Home Insurance. This offers additional protection to the home since there’s often an increased risk of trespassing and vandalism.

Builder’s Risk Coverage

Similar to Vacant Home Coverage, Builder’s Risk offers added protection for homes that are still under construction. Construction can sometimes leave your home vulnerable to accidental damage, so this coverage will consider those risks and help prevent major financial loss in qualifying circumstances.

Beware of Online Insurance Quotes

Online quotes are a good starting point. We even offer them ourselves! But here’s the thing though. The insurance market can be very competitive, and not all companies are looking out for your best interest. Sometimes they’ll slim down your coverages just so they can offer the lowest rates and win the sale. If you don’t have a full conversation with your agent before you purchase, you might not realize until much later that you got a good rate, but not a good deal.

We recommend working with an agent who’s willing to put some work into a custom quote. Sometimes we have clients who are more concerned about some coverages than they are about others, and we’re always happy to figure out a good strategy for them. As an independent insurance agency, we’re not exclusive to one specific provider. We work with a variety of really great providers and can shop your rates to see who can give you the best coverage for your budget. And, of course, one of the best things we can offer is a personal conversation and a thorough explanation of what your coverages mean for you.

 

Home Insurance Springfield Missouri The Resource Center

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The Resource Center is a local team in Springfield, Missouri. Collaborating with a local team is an excellent option for anyone who enjoys a personable, one-on-one experience where you know everyone by name. Our mission is to help make your experience easier. We strive for success in everything we do and are excited to talk with you about your situation and case.

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