New home insurance from Eureka – the ‘baby’ of home insurance industry
EureKA, Missouri (Reuters) – The U.S. mortgage insurance industry is experiencing a “moment of truth,” according to the head of one of the nation’s largest home insurance companies, as home prices across the country continue to climb, as consumers look for value for their money.
The head of the largest home insurer, Nationwide, said on Monday that home prices are likely to rise about 7.5 percent this year, up from 7.1 percent in 2017.
Home insurance companies have historically struggled to find value, given the risk of default and the low price of homeowners insurance policies.
“The risk premium is going to be higher in the first year, but if you look at it as a year-to-year comparison, the risks that are associated with a loss of a mortgage are lower than those associated with losing a home,” Robyn Lichtman, CEO of Nationwide, told Reuters in an interview.
Home prices in the United States have jumped by 10.6 percent over the past year, according to data compiled by real estate research firm CBRE.
The median price of a home in the U.K. was $415,000 in January.
Nationwide said it would be a good time to start paying homeowners premium.
“In the first quarter of 2017, we saw some of the most rapid growth we’ve seen in homeowners insurance, and the premiums have been trending higher than expected,” Lichtmann said.
Nationwide is also offering new home insurance policies that are priced based on the number of people in the home, instead of their income.
Homeowners in California, which has been hit hard by a shortage of homeowners, have been able to buy homes without having to pay a premium.
Homeowners in the Northeast U.T. are finding cheaper options, such as using cash and borrowing from friends or relatives, which is an option for many people in that region.
Lichtman said she expected the number and quality of home loans to continue to increase as the cost of insurance continues to fall.
Home ownership rates are also on the rise in the Midwest, where people have been buying more homes and putting more money into their houses.
The average price of the median home in Ohio rose by 7.6% last year.
Nationsylvania, with the highest home ownership rates in the country, has also seen a jump in its average home price, from $265,000 last year to $278,000 this year.
The number of Americans with home ownership rose from about 4.2 million in 2016 to 4.4 million in 2017, according the Census Bureau.
The number of homeowners who own a home is increasing more rapidly than those who don’t, with homeownership in the South growing at an annual rate of about 3.5%.
The average number of mortgages in the mortgage market has increased by nearly $50,000 since 2012, according a report by the Mortgage Bankers Association.
Home prices have also increased by a smaller amount, though, from around $1,000,000 to around $900,000.
The rate of home loan delinquency has increased dramatically over the last decade, as the financial industry continues to consolidate and cut back on lending.
A report from the Mortgage Information Corp. last year said home loans are more than 25 times more likely to be delinquent than loans made in the past 10 years.
The mortgage delinquency rate is a key measure of a lender’s ability to pay down a loan, as well as a key indicator of how much a home might cost to repair.
The Federal Reserve Bank of New York said in a report in March that home loan rates are likely higher than in any time in the last two decades, but that the increase in delinquencies was likely due to a combination of better servicing, new lending rules, and a slowing down of home prices.
Some analysts have suggested that a slower economy and higher levels of household debt may be holding back home ownership.
Nationwide has said that home ownership will likely rise even more this year than in 2017 and beyond.
A recent study by the Federal Reserve and the Urban Institute found that home-value growth accelerated from 2009 through 2015.
The authors said the acceleration was driven by the surge in demand for home-equity products, such house-hunting and equity-indexing products.
The study also noted that more people were renting, making home ownership more attractive to buyers.