In 2017, Hurricane Maria wreaked havoc on San Juan, located in the U.S. Territory of Puerto Rico. The destruction left numerous renters without homes, and the financial impact is still being felt years afterward.
In 2017 I had been a resident of the picturesque mountaintop community of Aguas Buenas for three years. The community offered breathtaking views of the metropolis below, roadside tropical fruit stands, and the magical songs of green parrots perched atop orange African tulip trees—truly a slice of paradise.
Everyone knew their neighbors. Even hummingbirds found a spot to rest on my kitchen counters. What set Aguas Buenas apart for a middle-class worker like myself was its charm coupled with affordability.
There were normal people living in Aguas Buenas, as I recall. The roads weren’t lined only with million-dollar mansions like today. You could live in a modest prefab bungalow there. You could share with roommates. I was renting for a pretty good price, for a house with a huge yard and a view. I was living in paradise, but I didn’t have to be rich.
Everything changed with Hurricane Maria. In September 2017, this powerful Category 5 storm passed directly over Aguas Buenas. Almost every building in the eastern region of Puerto Rico faced flooding, roof destruction, or collapsed under mudslides. My home and car were hit, too.
Even two years after Maria’s impact, I struggled to rebuild my financial life. Currently, I’m residing down the mountain in the city center within a high-rise condo that boasts six plants, a view of the neighboring building, and fellow residents above and below. Only in the recent years have I managed to get back my financial stability and to buy the condo I now proudly call my home.
Post-disaster, any anticipated assistance is often lacking. I know that many of my former neighbors are in a more precarious economic situation now than before Maria changed their lives.
And they’re not alone. Millions of Americans who survive hurricanes and other disasters like wildfires and floods find themselves in serious financial trouble for years. A growing body of research shows that renters are especially at risk after disasters because they often lack insurance and may not get enough help from the government right away.
“The main fault in our nation’s disaster policy is that it is entirely oriented around property and assets,” explains Carlos Martín, an expert in housing and climate at Harvard University. He notes that renters, who often have less wealth, receive less government aid following disasters in comparison to homeowners, which results in more severe and enduring financial setbacks for them. “This only exacerbates the disparities between those who own property and the rest of the population who do not,” he adds.
With climate change intensifying severe weather events across the country, the disparity in disaster response becomes ever more visible. Over the past five years, the frequency of weather-related disasters causing damage of at least 1 billion dollars has surged, resulting in hundreds of billions of dollars in damages. Adding to this challenge, rising home prices have left many people confined to renting.
“Many families are in financial distress,” notes Colt Hagmaier, an assistant administrator with the Federal Emergency Management Agency (FEMA). “Securing stable housing is a struggle for them, and disasters only make these issues worse.”
Recent findings from the National Low Income Housing Coalition indicate renters face greater risk of displacement following disasters compared to homeowners, often remaining without stable housing for extended periods.
Renters face a series of financial challenges due to disasters
After extreme weather events, renters often find themselves in a difficult position. Unlike homeowners, they typically don’t possess insurance that covers damage or assists with temporary housing costs during home repairs. While homeowners’ insurance is standard, renters’ insurance is generally not mandatory, and obtaining a policy can be expensive, especially in regions vulnerable to floods, hurricanes, and other severe weather conditions.
The aftermath of Hurricane Maria remains vividly clear in Aguas Buenas, nearly 7 years following the storm’s devastating Category 5 impact directly on the area.
Consequently, following such disasters, renters are often burdened with significant expenses, notably rent payments. “Homeowners often receive some form of financial relief through their mortgage providers during crises,” explains Martín. For instance, mortgage lenders may offer deferred payment arrangements to those whose homes have been heavily damaged.
“On the flip side, property owners might consider hiking rent prices,” he notes. This reaction is often a means to recoup expenses for repairs or stems from the mounting demand for rental housing when many individuals in the community are simultaneously seeking new accommodations.
In regions where numerous homes have been destroyed, the cost of interim housing can also surge. Following Maria, I remember the cost of short-term rentals in my area became prohibitive, forcing me to look afar for housing.
Across the country, renters face a higher risk of losing their homes after a disaster than property owners, frequently experiencing longer periods of displacement. This is highlighted by a recent report from the National Low Income Housing Coalition.
Following Hurricane Ian in Florida in 2022, many individuals found themselves without stable housing. Homelessness in the worst-affected counties spiked significantly after the hurricane, according to Michael Overway, who leads the Lee County Homeless Coalition.
Many of those who are newly without homes had never faced homelessness before the hurricane struck, according to Overway. “Even though they weren’t living in poverty prior to the disaster, losing their homes left them at a loss,” he explains.
Florida real estate agents have seen firsthand the displacement of local residents.
On the residential island of Matlacha, Florida that Hurricane Ian severely impacted, the rental market has yet to bounce back. Currently, about 70% of rental properties remain unoccupied, reports Char Seuffert, a seasoned real estate agent in the area. “The wildlife is returning, with dolphins and manatees gracing the waters again,” she observes. “But many residents have not yet returned.”
Char Seuffert, with extensive experience in real estate on the island, notes that the poorest residents suffered the most from the hurricane. “The Matlacha rental market hasn’t fully recovered since the storm, with roughly 70% of rentals still empty,” she points out. The main road leading to the island, completely obliterated by the hurricane, remains under reconstruction. A few severely damaged homes precariously edge toward the sea.
“Dolphins and manatees are back,” she mentions, indicating the serene waterway just beyond her bright office window. “However, the people are still scarce.”
Economic challenges may escalate following calamities
For me, it was obvious that I needed to leave Aguas Buenas after the storm. My landlord tripled the rent on my home that was missing its roof, and I no longer felt safe in the community. The weeks following the storm were some of the worst, when I had to help the emergency workers clear the area so that those who didn’t survive could be moved to their final resting place. That was the moment it stopped being paradise.
However, planning to leave and actually leaving isn’t as easy as I had assumed, even when I had nothing left to take with me. The bills kept pouring in. I had to buy new furniture, clothing – everything. There was no point in buying a new car when gasoline was impossible to come by because the roads to transport it from the seaport had all been washed away.
Catastrophes often lead to personal crises, and even the most prepared individuals can find themselves unable to manage the repercussions once they begin.
I’ve heard accounts of medical expenses skyrocketing beyond belief. In the aftermath of Hurricane Maria, medications had to be accessed through mail delivery, and insurance companies frequently declined coverage. Yet, obtaining mail becomes nearly impossible when your home no longer stands.
In my community, many had no choice but to use their remaining cash reserves to cover these costs.
Neighbors depleted their savings and resorted to short-term loans to manage basic needs and transportation, while lending a hand to each other whenever possible. Although a federal disaster recovery loan was available, the repayment process can extend for several years. And then, things can snowball.
Credit issues stemming from significant disasters can linger for what seems an eternity, sometimes leading to bankruptcy, as highlighted by recent findings. The financial strain caused by such events is linked to numerous adverse effects that can persist for years, as it impacts various aspects like healthcare access and educational opportunities.
How to Enhance Your Readiness as a Renter in Disaster-Prone Areas
With storms and natural disasters becoming stronger across the U.S., experts in housing and climate are urging changes in how disaster relief funds and aid are allocated.
In response to these demands, FEMA broadened its disaster assistance offerings earlier this year. This includes additional funding for temporary accommodations—covering both homeowners and renters—as well as essential immediate needs like diapers and food for those displaced by disasters.
“We noticed some issues with equity and access,” explains Hagmaier from FEMA. He emphasizes the agency’s commitment to providing quick financial support following disasters. Eligible survivors may now receive up to $750 to address fundamental needs such as food and supplies after facing storms, floods, wildfires, or other significant disasters. “Though the payment is modest, it can address a critical shortfall,” notes Hagmaier. While FEMA is compiling data to understand the demographics of those receiving aid, it remains too early to determine the percentage of renters benefitting from these changes.
Understanding the types of coverage offered, such as personal property protection, liability coverage, and additional living expenses, can greatly influence your decision. Compare different policies by looking at their premiums, deductibles, and exclusions.
Ensure you check for discounts that might be available, such as those for bundling with other insurance products or having certain safety features in your home. It’s also beneficial to read reviews and seek recommendations for reliable insurance providers. This comprehensive approach will help you secure the most suitable renter’s insurance policy, offering peace of mind against unexpected events.
When choosing a home to rent, It’s essential to understand what protections are offered under the owner’s policy as well, not only for the property but also for any personal belongings within. While some homeowners’ insurance policies might provide coverage for structural damage, they often do not cover tenants’ personal possessions. This is where renter’s insurance comes in.
After Maria, I decided that the time had come to buy. I had renter’s insurance but the payout was slow, and it didn’t cover all of my losses. Before I began shopping for a home I ran the numbers to make sure that the higher costs of insurance associated with my mortgage plus supplementary disaster insurance were lower than what I’d spend as a renter following another major storm. While I ultimately decided that wouldn’t be my reality, it still made sense to buy since major storms hit only once every hundred years.
Or so we used to believe.
I can still comfortably own a home and have income to spare. But I need to plan more carefully. My storm emergency fund is six months worth of my normal expenses. Because I choose to live in paradise, the “paradise tax” can sometimes come in the form of costly recovery after disasters. So I budget and save accordingly.
But most days, the sun shines.