Climate Risk Will Hammer Home Sales In Some Areas
News about exploding, rapidly expanding wildfires, cities flooded by torrential rains, and battered by hurricanes would eventually affect Americans’ decisions about where they might live. This is especially true if they are relocating. A new study shows this is an accurate assumption. The research indicates, in turn, that prices will drop in some parts of the nation.
Zillow released a study titled “More than 80% of home shoppers consider climate risks when looking for a new home.” Zillow senior population scientist Manny Garcia commented on this data, “Climate risks impact where most prospective buyers shop for a home.”
The risks listed in the study were flood (41%), extreme temperatures (37%), wildfires (37%), hurricanes (33%), and drought (31%). Based on these numbers and a US climate map, much of the nation will be considered too risky, at least for over a third of home shoppers.
Another consideration of where people will shop for a home is based on financial fears connected to extreme climate change. Home insurance often skyrockets in areas suffering from these effects. Private insurers have abandoned many of these markets because of unacceptable risk. According to The Wall Street Journal, “More than 30 states have some form of last-resort plan for people who can’t get coverage elsewhere.”
Over time, homebuyers’ reluctance to avoid climate risks may affect some of the nation’s fastest-growing markets. This would include, at least, Phoenix and Miami, which have gained in population over the last decade, contributing to rapidly rising home prices. Migration to these places may falter if Zillow’s research is correct.
