Hawaii Wildfires caused upwards of $6 Billion in economic losses

[bjl584]

Moody's: Hawaii wildfires caused up to $6 billion in economic losses (cnbc.com)

[myrdale]

I've wondered about this. If a house that would normally be worth $100,000 anywhere else, but because it is in Maui is worth $1,000,000, what was the economic loss? It only cost you $100,000 to rebuild, but it will cause you $1,000,000 to buy another across the street.

[disneysteve]

I've wondered about this. If a house that would normally be worth $100,000 anywhere else, but because it is in Maui is worth $1,000,000, what was the economic loss? It only cost you $100,000 to rebuild, but it will cause you $1,000,000 to buy another across the street.

I don’t think you can build a $1,000,000 house in Maui for $100,000.

[ua_guy]

Houses aren't insured for their real-estate value. They're insured for the cost to rebuild them. So, if you have a house that Zillow says is worth $1M, but it only costs $280,000 to rebuild from the ground up, that's what is calculated as the loss. So the "economic loss" is based on the estimated damage assessments. The article points out it doesn't factor in things like GDP loss, the social cost of the fires, or other factors. So, that number could be higher in terms of how much that blaze actually cost.

[disneysteve]

Houses aren't insured for their real-estate value. They're insured for the cost to rebuild them. So, if you have a house that Zillow says is worth $1M, but it only costs $280,000 to rebuild from the ground up, that's what is calculated as the loss.

Correct. And I'm sure with the extent of destruction, the need to import everything involved, and inflation in general, rebuilding costs will be greatly elevated there. I wonder how many of the destroyed homes and buildings were adequately insured.

[ua_guy]

I'm ignorant when it comes to the aftermath of natural disasters. Would FEMA step in to cover some of the losses for homes which might have been un- or under insured?

I've only been following the news about this at a headline level since it happened. I understand there will be quite a challenge to preserve the "old" Lahaina, with the possibility of developers and others wanting to cash in on what was a lot of old property and buildings. It was a wonderful and fun little town...been a while since I've been there, but I remember it fondly.

[LivingAlmostLarge]

Loss of income from tourism as well will have an impact on people's lives in maui.