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Huge Reconstruction Costs Leave Homes Underinsured In The Face Of Natural Disasters

A. Lawrence



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Homeowners in the U.S. experience a hard time. Irrespective of the place where you live, the chances are high that you’ll have to deal with natural disasters. Extreme weather calamities like floods, hurricanes or wildfires are causing immense damage. Many homeowners are underinsured against any natural disaster.

Every part of the country experiences at least one peril or another. This can be in the form of hurricanes or tornadoes, snow or hail, floods or tropical storms or earthquakes. This is leaving a big hole in the pocket of the homeowners almost leaving them with nothing. According to new research, much of the nation’s housing stock may be underinsured against these disasters.

The Costs Are Mounting

Rebuilding homes involved huge costs. And these costs have risen drastically in the past two years. The major reason behind the rise in the cost of reconstruction is a shortage of labor. New tariffs on materials are also adding to these rising costs.

However, if this consistent increase in the costs are not monitored and not factored recurrently into insurance coverage in disaster-prone areas, homeowners would have to bear huge losses that could even reverberate through the mortgage market.

According to the National Oceanic and Atmospheric Administration (NOAA), there have been 14 natural disasters in the last year itself. These have cost $91 billion to the United States. This was the eighth year in the row with at least eight disasters in the billion-dollar range.

New data from CoreLogic, shows numbers have come up on the mounting risks to the real-estate. This was found while evaluating the four disaster-prone areas in the US. Amy Gromowski, the senior leader of analytics at CoreLogic feels that “Underinsurance issues can cause financial devastation for property owners, artificially low coverage limits for insurance carriers, and increased loan delinquencies.”

What About Disaster Prone Areas

Homeowners who experience natural hazard events, such as the California wildfires, incur personal and financial devastation. Many aren’t able to rebuild their homes, which prolongs the region’s recovery and often causes homeowners to default on their mortgages.

In one of the four disaster-prone areas – California, 110,000 Southern California properties are in very high to extreme risk of wildfire. The risk is beyond $46 billion, keeping the average reconstruction cost to $400,000. When compared,   these costs are higher than they were two years back.

The cause behind the rise remains the – increase in the cost of labor and materials. Mathematically speaking thus, if just 1% of the homes at risk were a complete loss in a wildfire, the undervaluation of that 1% would be $25 million if insurance coverage is not current.

Corelogic categorized approximately 1.1 million properties at very high to extreme risk of loss from storm surge in the coastal hurricane-prone area along the Northeast Atlantic and Gulf Coast regions. CoreLogic further calculated the cost involved to reconstruct the at-risk properties of Florida to be $240 billion based on the recent increase in the costs.

This highlights the key fact that the financial impact of not updating reconstruction costs for two years is extreme. CoreLogic explains, “If a catastrophic event were to affect only 5% of homes and cause just 30% storm surge damage to those 5% of properties, the reconstruction cost undervaluation is approximately $205 million.”

Redevelopment Costs Are Rising

However, these are the risks only at the coastlines. These are secluding the impact if any inland flooding like Hurricane Harvey occurs.  There has been an upswing of 7% in the redevelopment costs in Houston in the past two years. There has been a potential deficit in insurance coverage in tornado-prone areas.

In Oklahoma alone, which averages about 56 tornadoes per year, about 1.3 million properties with $257 billion in reconstruction costs are at very high or extreme risk. The current cost of reconstruction has risen by 6.6% in the past two years.

Thus, insufficient insurance coverage would increase the risk to the mortgage market as well. Tracing evidence to substantiate, CoreLogic reported that following three major hurricanes in 2017, serious mortgage delinquency rates tripled. Houston and Cape Coral, Florida and San Juan, Puerto Rico were key areas of delinquency.

“The disruption of a family’s regular flow of income and payments, as well as substantial loss in property value, can trigger mortgage default; especially if homeowners are underinsured and cannot afford to rebuild.”

Frank Nothaft, Chief Economist at CoreLogic

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Blackberry Stock Price Corrects 23% In A Month, A Value Buy?

Jon Phillip



blackberry stock price

There was a time when BlackBerry Limited (BB) used to be one of the leaders of the telecommunication industry by virtue of its smartphones. However, the company’s glory days are well in the past and the stock declined by more than 15% recently after it released its results for Q1 2019. The stock is now trading less than $8 but at the same time, it is important to note that the company has managed to deliver as far as its top-line figures are concerned.

Poor Earnings Lower Blackberry Stock Price

The software and services division is now the company’s most important division. It has emerged as the biggest revenue generator for the Canadian company. Overall sales for Blackberry rose 16% year over year in the latest reported quarter.

Special Report | On-Demand Tech Companies Hit Billion-Dollar Valuations; Here’s How Investors Can Capitalize In The Market

However, in the software and services, it was a far more pleasing picture. Its GAAP revenues rose 27% year over year. The company seems to be on the right track in terms of its plan to turn around. But the market doesn’t seem to take a fancy to it. The reasons behind this might have something to do with allegations made by certain parties.

They say that the company uses non-GAAP methods to report earnings. If there is any kind of accounting cloud over a company, growth may be far away.

Where Does This Leave Blackberry Stock Price?

However, Blackberry has been quick to defend itself against these allegations. Financial disclosures of the company are fully SEC compliant. It remains to be seen whether the SEC takes an interest in the matter.

This problem has been the biggest reason behind the underperformance of Blackberry stock price. That’s despite the company’s decent performance. The acquisition of machine learning company Cyclane is also a positive development. But it remains to be seen how it affects Blackberry’s future growth.

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Uber Technologies (UBER) Stock Price Hits $45 Mark Again; Are Delivery Stocks Set To Fly?

A. Lawrence



Uber Technologies (UBER) stock price hit its IPO level of $45 again. Since its IPO, this becomes the fourth time that the company has hit its $45 mark. Each time it has been a real challenge for the company to rise above the IPO price.

Uber has made its name through its market dominance however it’s growth continues to be slow-paced and also has continuous losses, making Uber less attractive to many. However, the thing that Uber has done is bring more attention to the on-demand and delivery stock arena.

Special Delivery: Small-Cap Delivery Stocks Are Gaining Ground In Cannabis

Driven Deliveries Inc. (OTC: DRVD) is one of the only publicly traded cannabis delivery service operating in the United States. Now that’s what we call first-mover advantage. Driven Deliveries provides on-demand marijuana delivery in select cities where allowed by law. The service provides the legal cannabis consumer the ability to purchase and receive their marijuana in a fast and convenient manner.

>>Read More>> Two Massive Growth Industries, One Choice for Investors

Consumers are growing increasingly lazy with most of all purchases from retail to food shopping being done online. And now you can add weed to that list. Driven Deliveries (OTC: DRVD) is quickly gaining steam in legal US markets as the new delivery option for customers is resulting in increased revenue and transactions for dispensaries.

Food delivery apps and services such as GrubHub and Uber Eats have already expanded revenue generated in the food-service industry by 22% or more. Consumers love getting what they want without having to leave their house to get it, plain and simple.  

In Spite Of Being A Broken IPO, Still Worth An Investment

Cannabis is just one small niche expanding into the on-demand technology market. Uber has always managed to capture the headlines. This week it did that by launching itself in the sixth German city, Hamburg. The company further has plans to acquire Postmates which gives UberEats a heavy competition provided the price is right.

McDonald’s exclusivity with Uber also came to an end this year with the former getting into a contract with DoorDash. The company is set to report its financial results for Q2 on August 8. Uber had given accounts of its earlier performance through the prospectus issued during the IPO.

UBER stock price has been trading at $40 range since June. But, the figure is likely to change in the coming future for better. Uber has been able to disrupt various markets like those of food delivery, personal mobility, and freight logistics. In Q1 results, the company had reported 93 million monthly active platform consumers.

The revenue of the company has been on a slow rise especially on a net basis. The company sends a major portion of the money received to its drivers to keep them encouraged and active. This is a move that is not going away anytime soon. The deep deficits could also prove to be advantageous for the company.

Even though Uber looks like a broken IPO, it still leads in its industry. The concerns with the valuation persist still for good reasons. Uber continues to ride at a market cap which is five times the current year’s revenue. But, one would have to wait till 2025 to see a positive earning in the growing market.

Uber stock price
Disclaimer: Pursuant to an agreement between MIDAM VENTURES, LLC and a third party, Data Marketing Solutions Inc., Midam was hired for a period from 04/22/2019 – 5/22/2019 to publicly disseminate information about Driven Deliveries Inc. including on the Website and other media including Facebook and Twitter. We were paid $50,000 (CASH) for & were paid “0” shares of restricted common shares. Midam has been paid an additional $50,000 and extended its contract to 6/15/2019. Midam has been paid an additional $50,000 and extended its contract to 7/15/2019. We may buy or sell additional shares of Driven Deliveries Inc. Inc. in the open market at any time, including before, during or after the Website and Information, provide public dissemination of favorable Information.

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Stock Price Friday Update – July 19, 2019

Joe Samuel



stock market news July

ROKU Stock Price Hits Another Life Time High: Good News For Tech Stocks?

In 2019 alone, ROKU stock has risen by as much as 271% as the company continued to add new customers and boosted revenues from advertising. However, could the latest surge be a signal for the next bull market in tech?

See For Yourself

3 Biotech Stocks To Watch After Big News This Month

Here is a look at 3 biotechnology stocks that proved to be winners recently.

Click Here To Read More

IPO News: Medallia Goes Public On Friday, July 19

Over 14 million shares of the company will be available to be traded at $16 to $18 per share on NYSE. And of course, investors will be watching MDAL stock price closely. Bank of America Merrill Lynch, Citigroup, and Wells Fargo Securities will oversee the IPO.

Click Here For Full Article

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