"A deal too good to be true" will reveal it's ugly head in this case. Insurance wants to cover a near sure thing. You can trick buyers into buying something uninsurable, once. And then they'll be forced to sell at a large loss. Once those stories start making it into media buyers will be far more cautious.

Most likely, these houses will get bought by corporations to be rented out. They'll have the resources to self-insure. And at the next natural disaster the building falls down, renters are homeless, and what gets built in it's place will be 2x the price.