Nearly one in four US homes faces severe or extreme wind, flood, or wildfire risk, but buyers are still showing strong interest in many of the most exposed markets. A Realtor.com housing and climate risk report puts the value of those homes at $11.2 trillion.
The findings arrive as insurance availability is becoming a larger transaction concern. Recent National Association of Insurance Commissioners data show rising premiums and insurer nonrenewals across the country, giving agents another reason to surface insurance, HOA costs, and property-level risk before buyers commit.
Why buyers still shop high-risk homes
Climate exposure does not automatically discourage buyers, particularly in expensive markets where price remains a major constraint. In Santa Clara County, California, homes with severe or extreme risk were priced at 78% of the price per square foot of lower-risk properties while drawing 48% more views per listing. In Los Angeles County, the relative view advantage for higher-risk homes narrowed after the January 2025 wildfires but rebounded within about a month.
Disclosure can still affect purchase decisions. A July 2026 NBER working paper found that homes labeled as having “extreme” flood risk sold at a 3.3% discount and remained on the market about a week longer than homes labeled “severe.” Agents should treat climate scores as risk indicators rather than substitutes for official flood determinations, insurance advice, inspections, or legally required disclosures.
Where climate risk costs show up
Among for-sale listings reporting nonzero HOA dues from June 2025 through May 2026, median monthly fees were $192 for homes facing severe or extreme climate risk versus $125 for lower-risk properties — a 53.6% difference. The figures show an association and do not establish climate exposure as the sole cause of higher dues.
National Flood Insurance Program contracts in force also fell 4.5% between May 2025 and May 2026, from 3.62 million to 3.45 million. Texas recorded the largest state decline at 7.8%.
A lower contract count does not mean every affected homeowner became uninsured; policies can shift to private carriers or disappear for other reasons.
5 checks before buyers commit
For clients considering properties exposed to flooding, wildfire, or severe wind, agents can help raise the right questions early while leaving specialized advice to licensed professionals:
- Check property-level risk. Review available Fire Factor, Flood Factor, and Wind Factor scores and compare the property with surrounding homes.
- Get insurance quotes early. Buyers should obtain written quotes for the specific property instead of relying on the seller’s current premium or neighborhood averages.
- Review HOA documents. Examine available budgets, reserves, insurance information, and disclosed pending assessments.
- Clarify flood coverage. Have buyers confirm with their lender and insurance professional whether flood insurance is required or advisable and whether NFIP or private coverage is available.
- Calculate total carrying costs. Compare mortgage payments, taxes, insurance, HOA dues, and other known recurring expenses with lower-risk alternatives.
Prepare for risk questions before listing
Agents who understand a property’s documented risk factors and available insurance and HOA information can anticipate buyer questions before the listing reaches contract. That does not mean predicting future premiums or guaranteeing insurability. Listing agents can identify documents buyers are likely to request and help sellers prepare for applicable disclosure requirements.
Know the professional boundaries
Climate-risk scores, FEMA flood designations, insurer underwriting decisions, and state disclosure requirements are separate issues. Agents can help clients identify questions and gather documentation, but insurance professionals should address coverage and premiums, while official government resources should be used for flood-zone determinations.
A climate-risk score alone cannot tell buyers what insurance will cost or whether coverage will remain available. Buyers should have property-specific insurance quotes and available HOA information before those costs can affect financing or the decision to proceed.