Understanding the Impact of Environmental Factors on Property Value

Zillow's New Move: Why Climate Scores Could Reshape Property Values 🏠 The world's largest real estate platform just added climate risk scores to every listing. Why? Because 80% of buyers now demand this data before purchasing. This isn't just another website update - it's a major market signal about the future of property values. Let's decode what this means: 1. The Market Reality • Insurance costs up 50% in high-risk areas since 2020 • Over half of listings face extreme heat exposure • 17% at major wildfire risk • 13% at major flood risk 2. The Buyer Shift • Climate data now essential to purchase decisions • First-time buyers prioritizing long-term climate safety • Insurance availability becoming deal-breaker • Risk scores affecting property negotiations 3. The Investment Impact 💡 • Banks updating lending criteria • Property values shifting based on risk exposure • New market for climate-resilient upgrades • Insurance companies restricting coverage in vulnerable areas Here's why this matters: When climate risk becomes visible on every property listing, it forces the market to properly price these risks. This could trigger the largest repricing of real estate assets in modern history. Question for real estate professionals: How are you preparing clients for this new reality where climate risk directly impacts property values? #RealEstate #ClimateRisk #PropertyValues #MarketSignals

🚨💧 Water Scarcity & Real Estate: A Hidden Risk Investors Can’t Ignore. The western U.S. is in a historic drought, with groundwater levels plummeting and key water sources like Lake Mead & Lake Powell at record lows. As shown in this NASA satellite data, vast areas of the country are facing severe groundwater depletion, threatening property values, development costs, and long-term livability. 🏡 Why Should Real Estate Investors & Developers Care? ✅ Housing Demand Shifts – Water stress can drive migration trends as people seek more sustainable regions. ✅ Higher Costs & Restrictions – Developments may face building limitations, increased utility costs, and water-use regulations. ✅ Risk to Property Values – Homes in high-risk drought zones may become harder to sell or insure. 🌎 Smart investors are factoring in water availability before making their next move. Tracking local water policies, infrastructure resilience, and long-term sustainability is key to future-proofing your investments. Are you considering water risks in your real estate strategy? #WaterCrisis #RealEstateInvesting #SustainableDevelopment #DroughtImpact #FutureProof

Weekly Monday Sustainability Post: Climate change will reduce real estate value in the near-term with a recent study putting it at $1.47 trillion lost in the next three decades. Some areas will suffer more than others. For example, some counties in California, Florida, and Texas will experience net declines of 10% to 40% in their property values by 2055. In addition to property values going up, insurance premiums are set to increase. There's an estimated 4X premiums increase in Miami, 3X in Jacksonville, Tampa, and NOLA, and 2X in Sacramento (see graphic with this post). Nationwide, insurance premiums will increase an average of 29.4% by 2055. This is comprised of a 18.4% correction for current underpricing and an 11% increase from growing climate risks. Some areas will benefit. Other properties across the country will see an increase in $244 billion. They'll also see more people coming in as 55 million people migrate away from extreme heat, wildfires, and flooding. This year alone is expected to see 5 million people move. Areas expected to see domestic climate migrants are northern, currently less-populated areas from Montana to Wisconsin and in parts of the East. With nearly two-thirds of U.S. adults being homeowners (including myself likely in the near-future), this is scary news. You can't just assume your property values will go up. The ramifications of climate change need to be considered when buying. People are starting to wake up. Zillow found that 73% of home buyers said at least one climate risk impacted where they shopped for a home. For more information, check out the First Street's 12th National Risk Assessment linked to in the comments. Note that the report hasn't been peer-reviewed, and there are important caveats and uncertainties associated with the work since it combines results from multiple models and peer-reviewed studies. The models don't account for climate adaptation measures and don't include inflation. These results are best used to identify locations that are most at risk for climate change-related increasing insurance costs, property devaluation, and population change. #realestate #climatechange #insurance