--- title: Nearly One-Quarter of US Homes Face Severe Climate Risk, but Prices Rarely Show It description: Realtor.com finds 23.1% of US homes carry severe climate risk, yet buyers keep paying full price. The cost lands later in HOA fees, insurance and delinquency. author: Darie Nani (Editor-in-Chief) updated: 2026-07-24T23:27:06.902Z canonical: https://www.sovereignmagazine.com/article/realtor-com-climate-risk-home-prices image: https://cdn.nanimediahouse.com/climate-risk-housing-market-30299.webp categories: Markets content_type: News region: United States publication: Sovereign Magazine schema_type: Article --- Some 23.1% of US homes, representing $11.2 trillion in value, face severe or extreme risk from wind, flood or wildfire, Realtor.com found in a report published this week. In many of the priciest and most exposed markets, buyer demand is holding steady or rising, not falling, a pattern that runs against what the risk itself would predict. Climate risk in the US housing market is well quantified, down to individual property scores, yet it is not showing up as a price discount in most of the places carrying it. Instead, the cost lands downstream, in fees, premiums and delinquency data that most buyers do not see until after closing. ## Why Home Prices Rarely Reflect Climate Risk The pattern holds across some of the largest, most exposed counties in the country. In Santa Clara County, California, homes facing severe or extreme risk are priced at 78% of the per-square-foot price of lower-risk homes nearby, yet draw 48% more views per listing. In Los Angeles County, severe or extreme risk homes are priced at 75% of lower-risk homes and draw 23% more views. Even the January 2025 Los Angeles wildfires barely dented that appetite: the ratio of views between severe and lower-risk homes dipped from 1.21 in December 2024 to 1.11 the following month, then rebounded to 1.31 by March. In some markets, risk carries a premium rather than a discount. In Anne Arundel County, Maryland, severe or extreme risk homes are priced 44% higher than lower-risk homes, reflecting demand for Chesapeake Bay waterfront property. In Llano County, Texas, severe or extreme risk homes sell for twice the price of non-severe risk homes, driven by demand for Hill Country ranches and river retreats. Xu, an economist at Realtor.com, said price remains the dominant factor for most buyers even where the risk is documented and well known. ## HOA Fees and Insurance Premiums Already Show the Cost Homeowners in high-risk areas pay a median $192 a month in HOA fees, 53.6% more than the $125 median in lower-risk areas, the report found. The gap is widest in Delaware, where high-risk homeowners pay $177 against $25 in lower-risk areas, an increase of 608%. South Carolina follows at $296 versus $50, up 492%, and Oregon at $423 versus $114, up 271.1%. Maryland and Pennsylvania also show gaps above 120%. At the metro level, Portland, Oregon; Washington, D.C.; and Seattle post the widest divergence. Mortgage delinquency data tells a related story. Serious delinquency rates in Louisiana and Mississippi stood at 1.7% and 1.4% respectively as of September 2025, against a 0.8% national average, according to Consumer Financial Protection Bureau data cited in the report. Florida and Texas started 2023 near the national average and have since climbed above 1.0%, a trend the report links to storm damage and rising insurance costs compounding over time. ## NFIP Flood Insurance Rates Are Rising as Coverage Retreats Active National Flood Insurance Program policies fell from 3.62 million to 3.45 million between May 2025 and May 2026, a 4.5% decline nationally. Texas saw the steepest drop, 7.8%, with Oklahoma, Idaho, Mississippi and Alabama each falling more than 6%. The retreat follows the rollout of the NFIP's Risk Rating 2.0 model, which prices premiums against a property's individual flood risk rather than a flat zone-based rate. Median annual NFIP premiums are projected to nearly double over time, from $689 in December 2022 to $1,288. The risk classifications behind the report come from [First Street's](https://firststreet.org/methodology/flood) Fire, Flood and Wind Factor scores, an independent model built on peer-reviewed research that forecasts how flood risk changes over time as conditions shift, overlaid on Realtor.com listing and valuation data from June 2025 through May 2026. > "Price is still the biggest motivator for a lot of home shoppers, even in places where climate risk is well known. But that doesn't mean the risk disappears. It shows up later, in insurance premiums, HOA fees and financing, often after the sale is already done." > — Jiayi Xu, Economist, Realtor.com Xu added that having the full financial picture, including future insurance costs and coverage availability, matters as much as the purchase price itself, and that choosing a high-risk area for affordability or lifestyle is reasonable as long as it is an informed choice. More at [Realtor.com](https://www.realtor.com). ## FAQ **Q: Why isn't climate risk reflected in home prices in every market?** Demand factors such as scarcity, waterfront access or lifestyle appeal can outweigh risk in a buyer's calculation, as in Anne Arundel County and Llano County, where severe-risk homes command a premium rather than a discount. In other high-cost markets like Santa Clara and Los Angeles counties, buyers continue to pay near full price for exposed properties even after climate events, with the true cost surfacing later through insurance and fees rather than upfront in the sale price. **Q: How does climate risk affect home insurance costs?** Insurers and federal programs are increasingly pricing risk at the individual property level rather than by broad zone. The NFIP's Risk Rating 2.0 model has pushed median annual premiums from $689 toward a projected $1,288, and active NFIP policy counts have fallen 4.5% nationally as coverage becomes costlier or less available in the highest-risk areas. **Q: What is NFIP Risk Rating 2.0 and why are flood insurance premiums rising?** Risk Rating 2.0 is the federal flood insurance program's current pricing model, which ties premiums more closely to a property's specific flood exposure rather than a flat, zone-wide rate. Since its rollout, premiums have climbed and policy counts have declined fastest in states like Texas, Oklahoma, Idaho, Mississippi and Alabama, all of which saw drops of more than 6% between May 2025 and May 2026.