Does Access to Flood-Risk Data Impact Homebuyer Decisions?
A recent three-month randomized controlled trial by Redfin revealed that homebuyers who have access to flood-risk information when browsing home listings online are more likely to view and make offers on homes with lower flood risk than those without access. The survey included 17.5 million Redfin.com users, half of which had access to property-level flood-risk scores and half of which did not.
Those who viewed homes with an average flood-risk score of 8.5 prior to the study went on to place a bid on homes with an average score of 3.9 after reviewing flood-risk data. On the contrary, users who viewed homes with a flood-risk score of 8.5 before the study but were not given access to risk data went on to bid on homes with an average score of 8.5, Redfin reports.
“We now have definitive evidence that the risks posed by climate change are affecting where Americans choose to live. Before Redfin’s experiment, that was just a hypothesis,” said Redfin Chief Economist Daryl Fairweather. “Equipping people with flood-risk information helps them make more informed decisions. Some will opt to move out of risky areas altogether, while others will stay put but invest in making their homes more resilient to disaster.”
Fairweather continued: “As more house hunters become aware of climate risk, homes in endangered areas will likely receive fewer offers, causing home values to fall. At the same time, we may see prices in lower-risk, inland areas rise as more Americans move there to avoid flooding.”