This blog post summarizes a new analysis, published by Realtor.com and based on First Street Foundation data. More than one in four U.S. homes face severe or extreme climate risk.
I outline the scope of the risk and which hazards are most prominent. I also discuss how insurance markets are reacting, and what this means for housing affordability and market practices, drawing on three decades of experience in environmental risk assessment.
Scale of the problem: how many homes and what value is at risk
The headline finding is stark: over one in four U.S. homes—representing nearly $13 trillion in market value—are currently exposed to severe or extreme climate hazards.
This is not just an environmental story; it is a financial and housing-policy issue with immediate implications for homeowners, renters, lenders, and municipalities.
The data combine mapped hazard exposure with home locations to quantify both physical risk and the economic footprint of that risk.
Which hazards pose the greatest threats?
Different climate hazards affect different parts of the country. The study ranks hazards by the percentage of homes affected and highlights the dominant threats.
Damage, insurance costs, and housing affordability
The real-world consequences are already substantial: so far this year, extreme weather events have destroyed about 63,000 residential buildings and caused more than $20 billion in direct damages.
Those losses are translating into higher insurance costs and shifting coverage availability across markets.
Insurance burden varies widely by metro area and state. The distribution of premiums is a critical lens for understanding affordability impacts.
Where insurance is already unaffordable
In cities with concentrated hazard exposure, insurance premiums have risen relative to home market values.
Miami and New Orleans are the most acute examples, with premium-to-market-value ratios of 3.7% and 3.6% respectively, compared with a national average of 0.8%.
States bearing the highest insurance burdens include Florida, Louisiana, Oklahoma, and Texas due to frequent hurricanes, floods, and tornadoes.
Experts warn that these elevated costs are amplifying the nation’s housing affordability crisis, particularly in lower-value, high-risk neighborhoods where buyers have less capacity to absorb rising premiums or to secure affordable coverage.
How markets are responding and what comes next
Markets and firms are already adapting. Real estate platforms and data companies are integrating climate risk into their core products.
Banks and investors are paying closer attention to hazard exposure when underwriting loans or pricing portfolios. This shift reflects both regulatory anticipation and commercial opportunity.
Data, disclosure, and business models
Major platforms like Zillow and Redfin are incorporating climate risk indicators into listings. They are positioning themselves ahead of likely disclosure requirements and creating new value-added services.
Analysts note that selling climate data and analytics is becoming a distinct revenue stream for firms. These companies can serve banks, insurers, and government agencies with risk models and mapping tools.
Closing the gap between physical risk and financial planning will require better disclosure and more affordable insurance solutions. Targeted mitigation investments and policies that prevent displacement of vulnerable homeowners are also needed.
Here is the source article for this story: Your home has a 1 in 4 chance of being at severe risk from extreme weather