The Guardian recently reported that Zillow, the largest real estate listing site in the United States, has deleted the function that discloses the risk of real estate exposure to the climate crisis. This is in response to complaints from landlords and the real estate industry that house prices are falling.
Last September, the U.S. online real estate market introduced a function that shows the risk of real estate exposure to disasters such as forest fires, floods, heat waves, storms, and air pollution. He explained, “Climate risk is now an important home-buying decision factor for many people.”
But real estate agents and some homeowners have complained that the scores are arbitrary and hurt home sales. Accordingly, Zillow eventually deleted this climate index and instead provided only a link to the First Street website, which analyzes the climate crisis in the United States. First Street is also a non-profit research group that provided climate risk measurement technology to Zillow.
Matthew Evey, CEO of First Street, pointed out, “In an era when the damage caused to homes by weather disasters has become more severe, if climate risk information is erased, many buyers will be flying with their eyes closed,” adding, “It is only transferred from pre-purchase decision to post-purchase responsibility, but the risk does not disappear.”
“Having access to accurate risk information before purchasing is not just helpful, it is essential to protecting consumers and preventing financial damage that will last a lifetime,” Ebi said. “If you don’t know this information, you will only find out too late that you should have purchased flood insurance after a flood or that you cannot get wildfire insurance after purchasing a home.”
CEO Ebi attributed Zillow’s deletion of the climate index to the lack of supply of affordable housing, recurring climate disasters, and difficulties in selling real estate. Due to the frequent occurrence of climate disasters, insurance companies are raising insurance premiums or even leaving regions such as California.
Housing and infrastructure are being directly affected by extreme weather worsened by climate change. The amount of disaster damage suffered by the United States last year was $182 billion, the highest ever. In particular, the threat of hurricanes and heat waves is concentrated in the southwestern region, such as Florida, where there is a lot of migration. As the risk of disaster increases due to climate change, not only is the price of U.S. home insurance rising, but it is also becoming difficult to sign up for insurance.
However, controversy arose in the real estate industry over measuring and rating the climate risk of individual properties. Some questioned whether such a detailed judgment was possible.
In fact, it was found that the higher the real estate price, the more climate risk information discourages some buyers. Last year, a mansion in Florida was put up for sale for $295 million, but after several price cuts, the property failed to sell and was taken off the market. Florida is the state with the highest real estate prices and the greatest risk of flooding in the United States.
Jesse Keenan, a climate risk management expert at Tulane University in the U.S., argued that “there are limits to scientifically evaluating each real estate,” and that “proprietary evaluation models with uncertain evaluations can actually have the opposite effect of weakening trust in climate science.” He suggested that the government should be more proactive in supporting and standardizing real estate risk assessments.
In response, CEO Ebi countered, saying, “First Street’s measurement model is based on science and has undergone peer review and empirical verification,” adding, “It provides improved risk insight than tools previously used by the industry.”
Copyright @ NEWSTREE All rights reserved.
