For the first time in 10 years, homes at low risk for natural disasters are appreciating in value faster than high-risk properties. For all risk categories tracked by housing market platform Redfin—which include heat, flood, and fire risk—home value growth for areas with low-risk homes outpaced high-risk areas.
In the past year, the value of U.S. homes with low heat risk increased by 7% to $17.7 trillion, compared with a 6.3% rise for high-risk homes, now worth $29.7 trillion. Values for low flood-risk homes rose 6.7% to $40.2 trillion, while high flood-risk homes grew 6% to $7.2 trillion. Similarly, homes with low fire risk saw a 6.6% increase in value to $39 trillion, slightly outpacing the 6.4% rise for high fire-risk homes, now worth $8.4 trillion.
“The fact that this is happening across risk types—and thus, across the country—is some of the best evidence we have that climate change is impacting people’s homebuying decisions,” said Redfin Senior Economist Elijah de la Campa. “With climate catastrophes becoming increasingly frequent and calamitous, many people have decided they don’t want to live in risky areas. And with insurance costs skyrocketing, many risky areas that were once affordable have become prohibitively expensive. The reality of climate change is setting in and it’s causing a reckoning; people are putting disaster risk higher on their list of considerations when looking for a home.” Read more
