By the time the homeowner has hired a specialist and paid the arbitration fee and deductible, the value of the claim has been eclipsed by the costs associated with filing a claim and going through arbitration. The shortage of affordable housing is caused by many complicated factors in the real estate market, not law suits. The actual cause of the shortage of affordable housing is much more complicated then the narrow reasons proposed by the sponsors. First, the value of the land is a critical factor in the value of the home and affordability of a home. With the rise in demand for new homes and the resulting rise in land value, the normal consequence is a rise in the cost of housing and a shortage in affordable housing.
Insurance is a very small percentage in the sales price of a single family home or condominium.
The escalation of home prices is not driven by insurance costs, but by the imbalance of supply and demand. Next, the costs of repairs and maintenance affect the true affordability of a home. A lack of quality control and the resulting rise in defective construction of mass produced housing results in serious added costs for homeowners for repairs and maintenance. Because of a ten year statute of repose on latent construction defects, homeowners are often stuck with the high repair bills associated with defective construction. The nature of many construction defects means that the defects are often hidden and are not readily identifiable by the homeowner until after the running of the statute.