Nearly Half Of American Homes Under Severe Threat From Climate Change, Study Reveals
A recent analysis indicates that close to half of all homes in the United States face threats from extreme weather conditions, shedding light on the potential ramifications of climate change on the housing market.
Realtor.com’s study reveals that approximately $22 trillion worth of residential properties nationwide are susceptible to severe or extreme damage caused by flooding, high winds, wildfires, heatwaves, or poor air quality.
An economist from the online real estate firm warns that such hazards can negatively impact home prices, lead to increased insurance expenses, and potentially destabilise the broader housing sector.
Even properties not directly affected by climate risks face challenges, including higher insurance premiums, which jeopardize potential sales and make homeownership more costly.
These findings align with a growing body of research and anecdotal evidence highlighting the magnitude of the issue for homeowners. According to First Street Foundation, a nonprofit specialising in climate risk analysis, nearly 36 million homes—comprising a quarter of all US real estate—are grappling with rising insurance costs and limited coverage options due to escalating climate threats.
Contrary to assumptions, climate risks extend beyond coastal and mountainous regions. First Street’s research shows that residents in inland states like Kentucky, South Dakota, and West Virginia are also experiencing notable increases in insurance premiums due to heightened damage from extreme weather events.
Drawing on First Street’s data, Realtor.com estimated the number of homes facing potential climate damage, focusing on the 100 largest cities. Key findings include:
– 5.5 per cent of homes, valued at $3 trillion, are at severe or extreme risk from wildfires, with California bearing 39 per cent of these properties.
– 6.6 per cent of homes, worth $3.4 trillion, are highly susceptible to flooding, with New Orleans having the highest proportion of vulnerable homes.
– Over the next three decades, 18 per cent of homes will face damage risks from hurricane-strength winds.
– 9 per cent of homes, valued at $6.6 billion, face severe or extreme risks due to declining air quality.
– Homeowners in 19 states and Washington, DC, are mandated to obtain additional hurricane-related policies.
Climate change is not only affecting the housing market but also influencing residential patterns. First Street’s research indicates that over 3 million Americans have relocated due to escalating flood risks. Moreover, approximately 83 million Americans, or about one in four, are exposed annually to unhealthy air conditions.
Jay Banner, a climate scientist and director of the Environmental Science Institute at the University of Texas at Austin, emphasised the far-reaching impacts of these changes, stating during a panel discussion organized by Realtor.com that they are already beginning to affect nearly every major sector of society over the past two decades.