Redfin CEO Glenn Kelman says buyers are driven by affordability, and with the most affordable metros also being the ones most at-risk for climate change, buyers are “marching into the jaws of destruction.” In the west, wildfire season is longer and more intense, and hurricanes and floods are also worsening, according to scientists. But buyers are not deterred. Kelman says buyers are headed to the more flood-prone Florida and the Southeast. Phoenix even surpassed Philadelphia last year for population size, reports CNBC. The city has grown faster than any other major American city in the last 10 years.
Located in the Sonoran Desert, Phoenix has long been known for its heat, but experts say it’s likely to become more extreme as a result of climate change.
Utah’s population grew more than 18% between 2010 and 2020, making it the fastest-growing U.S. state in that time period, according to the Census Bureau. Kelman pointed to a recent Redfin analysis that found more than one-third of homes in Utah face what the company classifies as “high fire risk.”
“I think this idea that climate change is going to be factored into how people think about housing, it hasn’t happened yet. The only people who have figured out are the [actuaries], the people who have to calculate the cost of insuring these properties,” said Kelman, who has led Redfin for about 15 years.
“Increasingly, it’s going to be harder to get insurance, it’s going to be harder to get a loan for these properties because the lenders are going to see the writing on the wall, that this collateral is at risk,” he added.
Natural disasters are expensive. In January, the insurance company Munich Re estimated the record amount of hurricanes, wildfires and floods last year led to $210 billion in damages across the world.