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MortgagePoint » Your Trusted Source for Mortgage Banking and Servicing News 18 February 2025 C O V E R S T O R Y C alifornia's wildfires, which were still burning as this issue went to press at the end of January, are expected to have significant impacts on government housing-related programs, the insur- ance market, housing affordability, and delinquencies, with many of the effects reaching far beyond the regions of the fires themselves. Before the Hughes Fire erupted in northern Los Angeles during the third week of January, some estimates already put the losses as high as 1.6% of the Los Angeles housing market, with more than 24,000 housing units destroyed and more expected to be lost. Though there has been some government response to the disaster already, some government agencies are remaining mum, wanting time to assess the damage and consider the response. Many mortgage industry experts are also reserving commentary on the ef- fects of the disaster until the full extent is known. Federal, State Programs A week before he left office, Pres- ident Joe Biden made federal funding available for the next six months to cover temporary housing, emergency as- sistance to individuals, and costs related to immediate public safety threats, such as the cleanup of debris and hazardous materials. However, in a late January interview with Fox News, President Donald Trump threatened to withhold federal disaster aid unless California leaders change the state's water management rules. In late January, California Gov. Gavin Nesom signed legislation provid- ing over $2.5 billion in disaster relief, with the funding designated to help bolster ongoing emergency response efforts, saying that the funding was the first step in the state's response to the recovery efforts. The funding includes: • Emergency protective measures, evacuations, sheltering for survi- vors, debris removal and cleanup, post-fire hazard assessments (such as flash flooding and debris flows), traffic control, and other necessary emergency response activities. • $4 million to help expedite rebuild- ing. The California Department of Housing and Community Devel- opment will allocate this funding to impacted local governments to provide additional planning review and building inspection resources for the purpose of expediting building approvals during the recovery period. • $1 million to rebuild fire-damaged school facilities. The funding will provide technical assistance to impacted local educational agen- cies (Los Angeles Unified School District, Pasadena Unified School District, impacted charter schools). The funding will make only a small dent in the devastation caused by the wildfires. To aid those impacted by the fires, California Insurance Commissioner Ricardo Lara in late January ordered California insurance companies to make advance payments on claims. "We advise wildfire-impacted house- holds to request these advances, continue tallying up the full extent of their losses and how much it will cost to replace their homes and possessions, and stay focused ONCE THE SMOKE CLEARS MortgagePoint examines how the California wildfires could have wide-ranging impacts on government programs, insurance coverage, and the housing market. . B y P H I L B R I T T P H I L B R I T T started covering mortgages and other financial services matters for a suburban Chicago newspaper in the mid-1980s before joining Savings Institutions magazine in 1992. When the publication moved its offices to Washington, D.C., in 1993, he started his own editorial services room and continued to cover mortgages, other financial services subjects, and technology for a variety of websites and publications.