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I don't think that's really true. Most of the value of homes destroyed in LA was in the location, not the building. Insurance will pay out on the cost of recons
by leoedin 2y ago
I don't think that's really true. Most of the value of homes destroyed in LA was in the location, not the building. Insurance will pay out on the cost of reconstruction - but in a lot of cases that's probably 10% of the "value" of the home pre-fire.
Equally, the land hasn't moved. If people wanted to live in the LA hills before the fires, they still will now. Certainly the prospect of a fire will reduce the value, but it won't make it zero.
- saurik 2y agoI think the point is that this might be true in the long term, but, in the short or even in the medium term, it doesn't at all seem strange to me that living in the LA hills is no longer attractive if the entire region is just a bunch of burned down houses.
- danaris 2y agoThat...is going to depend heavily on whether we are, collectively, somehow able to reduce the risk of fire there for future years. If, in the long term, the probability of having your house in the LA hills burn down over a given 5-year span approaches 1, the desirability of homes there is not just going to be down over the short or medium term.