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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: David Jones who wrote (984)	10/31/2001 2:47:50 PM
From: GraceZ	Read Replies (1) \| Respond to of 306849

Replacement is exactly what it is, what it costs to make you whole again in that location. What would you pay to rebuild the home as it is. You don't insure for market value, obviously I could take the insurance money and buy another house down the street for less than I can rebuild if I'm buying in an area where building costs are higher than existing property costs. You can buy houses in Baltimore City for $2000-$10,000. You cannot even repair the fire damage in a kitchen for that. Obviously it is rare that the whole house burns to the ground, this is why the insurance is so cheap. You can't insure a portion of the house you have to insure 100% (actually the rule is 80%) the house so that they cover 100% of your loss anywhere in the house.