Climate Fears & Rising Costs: A New Era for American Homeownership

CHICAGO, IL – January 05, 2026 – The foundation of American homeownership is shifting under the dual pressures of a changing climate and persistent economic strain. A landmark report released today reveals a startling statistic: nearly half (49%) of all American homeowners are considering relocating in 2026 specifically because of climate-related concerns. This finding, from the inaugural Kin Homeownership Trends Report, paints a picture of a nation on the move, driven not by opportunity, but by risk.

The report, published by digital insurance provider Kin, surveyed 1,000 homeowners and analyzed housing market data, uncovering a profound transformation in how Americans approach their most significant investment. The dream of a forever home is being replaced by a calculated assessment of long-term viability, where extreme weather forecasts and insurance premiums now weigh as heavily as school districts and square footage.

The Great Reconsideration: Climate Change Spurs Potential Housing Shift

The anxiety is palpable. According to Kin's report, an overwhelming 93% of homeowners are concerned about potential damage to their homes from a changing climate within the next few years. This isn't a distant fear; 68% expect the frequency of extreme weather events in their area to increase this year alone. This growing awareness is forcing a nationwide re-evaluation of what constitutes a desirable place to live.

Among the nearly half of homeowners contemplating a move, a quarter are looking to leave their state entirely. The report identifies states that are becoming increasingly undesirable due to perceived risk, with Florida (58%) and California (52%) topping the list of places movers would avoid. Other states facing homeowner skepticism include Louisiana (22%), Texas (21%), and Hawaii (24%).

However, current migration data presents a more complex narrative. While the intent to move away from risk is growing, U.S. Census data has shown that many of the fastest-growing regions over the past two decades are in the Sun Belt—precisely the areas most vulnerable to hurricanes, heat, and drought. This suggests a powerful disconnect where economic factors and lifestyle preferences have, until now, often outweighed long-term climate threats. Yet, signs of change are emerging. Research from the First Street Foundation has identified localized displacement, with over 3.2 million Americans moving away from high-flood-risk areas between 2000 and 2020. This indicates that while a mass climate exodus has not fully materialized, a more granular, block-by-block retreat is already underway.

The Affordability Squeeze: Insurance and Interest Rates Tighten Their Grip

Beyond the weather maps, homeowners are facing a battle on the economic front. The rising cost of simply owning and protecting a home has become a primary source of stress. The Kin report found that 80% of homeowners expect costs for home prices, repairs, and maintenance to climb in 2026. The sharpest pain point, however, is insurance.

After a period of staggering premium hikes—the national average home insurance premium rose over 40% in six years—it's no surprise that 82% of homeowners anticipate another increase this year. The cost of coverage is no longer an afterthought. For 49% of respondents, insurance costs now weigh "very heavily" or "seriously" on their home purchasing decisions, a sentiment 70% say has intensified compared to five years ago. The concern is so acute that nearly a third of homeowners (31%) are not confident they can maintain adequate coverage in 2026.

Compounding the insurance burden is the persistent barrier of high interest rates. The report highlights a significant gap between market reality and homeowner aspirations, with 74% stating mortgage rates would need to fall to 5% or lower for them to consider buying a new home. This desire clashes with expert forecasts. Economists from major institutions like Redfin and Zillow project that 30-year fixed mortgage rates will likely remain in the low-to-mid 6% range throughout 2026, held up by stubborn inflation. While affordability is expected to slowly improve as income growth outpaces modest home price gains, the market is far from the "buyer's paradise" many are hoping for.

A Tale of Two Markets: Stability and Volatility

Despite the widespread anxiety over rising costs, some experts predict a period of greater stability. Kin Founder and CEO Sean Harper, in the report's release, suggested the market is absorbing the shocks of recent years. "Elevated inflation was one of the big drivers of premium increases last year, but inflation is now occurring at a more predictable pace," Harper said. "Substantial premium increases were the story in 2024... they won't be the story in 2026."

This prediction of moderation is supported by trends in some of the nation's highest-risk insurance markets. In Florida and Louisiana, recent legislative reforms aimed at curbing litigation and stabilizing the market are beginning to bear fruit. After years of double-digit rate hikes and insurers fleeing the state, Florida's Office of Insurance Regulation has noted a significant drop in the average rate increase requests in 2024 and 2025. Similarly, Louisiana has seen ten new insurers enter its market and average rate increases fall from 16.2% in 2022 to 6.6% in 2024. This stabilization in catastrophe-prone states offers a glimmer of hope that a functional insurance market is possible even in the face of escalating climate risk.

Innovating for a New Reality: The Rise of Data-Driven Insurance

The chaotic environment has created an opening for a new breed of insurer. Companies like Kin have built their business model around serving the very markets that traditional carriers are abandoning. By operating with a direct-to-consumer digital model and leveraging vast amounts of property-level data, these insurtech firms aim to price risk more accurately and offer coverage where it is most needed.

This data-driven approach allows for a granular assessment of a property's unique vulnerabilities and strengths, from its roof age to its precise elevation, rather than relying on broad regional risk profiles. The strategy appears to be resonating with consumers. Kin, for example, reports an industry-leading Net Promoter Score (NPS) of 80, indicating exceptionally high customer loyalty, and has achieved profitability while expanding into 13 states.

As the market potentially shifts from volatile price hikes to a more stable environment, the focus for consumers may change. Harper advises homeowners to look beyond just the bottom line. "Since prices won't be fluctuating as much in 2026, shopping behavior will be driven by customer service," he stated. "You'll have more choices, so you should use this year as an opportunity to improve your position as a consumer." This new era of homeownership demands a more proactive and informed consumer, one who scrutinizes not only their mortgage rate but also the resilience of their home and the reliability of their insurer.