“I was dealing with a client in Naples on a $2 million villa, where the insurance quotes ran from a low of $10,000 to a high of $40,000,” Cohn said. “That’s enough of a difference to make a decision as to whether to buy or not to buy.”
Garcia concurred that rising insurance costs are making home buying and homeowning much more expensive. The condominium market has been hit especially hard by increases in insurance, making it challenging to find mortgage financing.
“In an effort to save money on premiums, some condominiums have taken stripped-down insurance policies,” Garcia said. “This can sometimes limit the kinds of loans owners can obtain there, which has a compounding effect.”
While Cohn isn’t ready to predict a situation like the 2008 housing crisis, she is concerned that continued tariffs could lead to a new housing crisis.
“In 2008, the real estate markets paused for like six months,” Cohn said. “We didn’t know it until we were a month into it, how bad it was going to be. I haven’t had anyone that I’m working with currently tell me that they are going to pull out of their deal.”