Rising Homeowners Insurance Costs: What Buyers Need to Know

When most people think about buying a home, insurance isn’t always the first thing on their minds. But as homeowners insurance costs continue to rise, it’s becoming a bigger factor in the overall cost of homeownership. For many buyers, this added expense is starting to shape their purchasing decisions.

Survey Shows Buyers Concerned About Insurance Affordability

According to a recent survey from the National Association of Realtors’ consumer website, 88% of home buyers believe they’ll pay more for homeowners insurance in the future. Even more concerning, 75% worry that coverage could eventually become unaffordable.

This growing concern highlights how insurance is no longer just a box to check during the closing process—it’s now a major part of how buyers approach the housing market.

Why Homeowners Insurance Costs Are Rising

Danielle Hale, chief economist for the website, explains that while insurance offers important protections—such as covering damage from fire, extreme weather events, or liability claims—the cost has gone up sharply in recent years.

There are two main reasons:

• More frequent extreme weather events are increasing risks for insurers.

• Higher rebuilding costs are pushing premiums higher.

These challenges mean that what once felt like a routine cost of homeownership is now a growing financial concern.

How Buyers Are Adjusting Their Home Search

With higher insurance premiums, today’s home buyers are rethinking their strategies. Some are:

• Expanding or limiting their home search based on projected insurance costs.

• Comparing coverage options more carefully to avoid being underinsured.

• Considering riskier strategies such as reducing coverage or forgoing certain protections altogether.

While these steps may lower upfront costs, they can also expose homeowners to greater risks in the future.

What This Means for the Housing Market

As the real estate market evolves, rising insurance premiums add yet another layer of complexity to affordability. Alongside mortgage rates, property taxes, and home prices, buyers now need to factor in the long-term cost of insurance before making an offer.

✅ Bottom Line: If you’re planning to buy a home, don’t overlook the impact of homeowners insurance on affordability. Talk with a trusted mortgage professional who can help you evaluate the true cost of owning a home in today’s market.

👉 Want to learn more about strategies for buying a home in today’s changing market? Click here to connect with me at NewHomeApproval.com.