By Todd Tomalak, Vice President | John Burns Real Estate Consulting
As Hurricane Matthew heads toward the East Coast of the United States, our thoughts are with our team members, family members, and millions of others along the Southeast coast.
Hurricanes obviously have a big impact on the construction business. Here are a few facts and a chart clients will receive in our next Building Products Industry Analysis and Forecast report.
- Hurricane Andrew caused about $24 billion of insured catastrophic losses in 1992 (in 2016 dollars).
- If a Hurricane Andrew-sized event were to occur, it would be larger than the entire annual US insured losses seen for the past three years.
- Note that TOTAL losses from the storm are even higher because non-insured losses are not counted in our data. Insured losses typically result in spending on building products.
- Based on 30 years of data, we estimate that about $10–$11 billion of disaster-driven residential remodeling spending per year is typical. Average residential remodeling from disasters totaled $7.1 billion for the last three years (2013–15).
- More than 200,000 homes have been built along Florida’s eastern coast in the last decade. CNBC did a nice summary of the housing value there.
New home construction has obviously already slowed, as crews are home preparing. Wet conditions will slow construction even more, and building material costs will likely spike. This video from The Weather Channel shows what the shelves were already like at home improvement centers before the storm hit.
Be safe, everyone!
