Right now it is common in Sonoma County to buy a property below the value of what it would cost to rebuild… OK let’s read this again: it is more expensive to build a home than to buy one that is already there…
This not only means that building new developments is not interesting for home builders. This also means that a buyer has to make sure that the home owners insurance chosen at time of purchase will cover the cost to rebuild. Quite often, buyers will go with the cheapest bidder. In the blur of the buying process: the inspections, the financing, the reports etc, Home Owners insurance is quite often an overlooked item. Any lender requires insurance coverage, however they may not always look at whether the coverage is enough. Recently I worked with a buyer who thought he had a great quote for his insurance policy. It was so cheap that luckily the lender he worked with realized this and strongly ‘encouraged’ him to change this. That is by the way that I am very happy with the team of professionals I love to work with : Erin Temple (Vantreo Insurance – phone 303-2574) and Darren Seliga (Seliga Financial – phone 577-8737). But that is beside the point;)
Reason for this blog posting is not only the national disaster that happened in New York 10 years ago but also a recent experience as well as an article I came across in the Huffinton Post. This article is about insurance coverage and disasters. Usually it is not a national disaster when your house burns down, but one needs coverage in both situations…
I might as well confess: the insurance coverage we have on our house is not on my list of priorities, it was when we choose the insurance we have right now, but then I forget about it in the hurry of every day living. My insurance agent, the aforementioned Erin Temple, reviews each insurance policy every year, to not only see if we are eligible for new discounts but also asks whether we had any changes in our life that might affect our insurance program. If you do not have a pro active insurance agent, it might make sense to have a yearly reminder on your calendar to initiate that call yourself… Or call Erin…
Moral of the story: with the current historic low interest rates as well as homes being ON SALE it is a great time to buy. Do not let insurance coverage be the forgotten stepchild…
And the cheapest is not always the best… quite often it turns out to be the most expensive. Even people with a Dutch heritage realize this;)
Have a most wonderful rest of the day
Mirjam
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[…] As mentioned before, in Sonoma County, it is cheaper to buy than to rent. BUT there is a major difference between being the tenant vs being the OWNER… When renting, the landlord is ultimately responsible/liabible for the house/asset. In the rush of buying, home owners insurance is often the forgotten stepchild. And after the home is bought and nothing happens, it’s something you pay for and never think about. See also a previous posting… […]
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