The Rising Cost of Homeownership in Texas
Texas homeowners are facing a significant challenge as insurance premiums continue to skyrocket, with annual increases ranging from 20% to 60%. The state’s severe weather events, including hailstorms, tornadoes, and freezing temperatures, result in billions of dollars in insurance claims each year. Coupled with inflation-driven repair costs, these factors have made homeownership increasingly difficult for many Texans.
A Growing Burden
For many prospective homebuyers, the cost of homeowners’ insurance is a major concern. Realtor Ashley Gentry advises her clients to check insurance costs before proceeding with other due diligence on a potential home. “Let’s get the insurance checked on before we do any other due diligence on the home. That’s the first thing during your option period that I’m telling my buyers to do,” she said. “Just make sure they can actually afford the insurance premiums and it doesn’t price them out of the home before they can even close on it.”
Existing homeowners are also feeling the pinch. Doreen Diego, who moved to Texas in 2019 and purchased a home in Denton in 2021, has seen her insurance rates more than triple. “We started at $1,200 a year. The next year, it was $1,700. Still within reason. The next year, we went to $2,700. The next year, we went to $3,700. And our renewal just came up this month. We just paid it at $4,700,” she explained.
Miguel Castro, a single father looking to buy a home, has also been deterred by rising insurance costs. “Yeah, I mean, they’ve doubled. I first started looking back in 2022, right after COVID. And back then, it was going to be, I think, $1,000 to $1,200 for the year. Now it’s looking like maybe $2,200 for the year. So that’s double,” he said.
Legislative Response
While the Texas Legislature has provided some property tax relief through increased homestead exemptions, lawmakers have not passed any significant legislation addressing homeowners’ insurance rates this session. Gentry believes it may take several legislative sessions before meaningful changes are made. “I think that even more so than understanding why we’re in this predicament, there needs to be a recalibration altogether of what the insurance companies are doing,” Diego added.
As insurance rates continue to rise, Texas homeowners and prospective buyers are left navigating a challenging housing market. The issue is a common topic of discussion, but tangible solutions remain elusive.
