Scores of Pandemic Homebuyers Purchased Vacation Homes With High Natural-Disaster Risk
July 05 2022 - 8:00AM
Business Wire
Purchases of second homes with high flood,
storm and/or heat risk surged roughly 40% over the past two
years
(NASDAQ: RDFN) — In 2020 and 2021, purchases of second homes
with high flood risk rose 45% from the prior two-year period
(2018-2019), according to a new analysis of ClimateCheck data from
Redfin (redfin.com), the technology-powered real estate brokerage.
There were also significant increases in purchases of second homes
with high storm risk (40%) and high heat risk (39%).
Demand for second homes surged during the pandemic as low
mortgage rates, remote work and the desire to escape the city drove
up demand for vacation properties. Overall, purchases of second
homes were up 37% higher in 2020 and 2021 compared with 2018 and
2019. Demand has since fallen back below pre-pandemic levels as
life has returned somewhat to normal, but many Americans now own
at-risk second homes, which has implications for the future.
“The threat of climate change isn’t the top concern for a lot of
homebuyers, which means they often prioritize factors like warm
weather and proximity to the beach over avoiding natural-disaster
risk. Second-home owners, in particular, have another place to live
if disaster strikes—another reason climate danger may not feel like
a pressing issue,” said Redfin Senior Economist Sheharyar Bokhari.
“But house hunters should be aware that purchasing in a
disaster-prone area not only puts them and their home at risk, but
their finances as well. Home values in climate-endangered places
may fall in the coming years as consumers learn more about the
risks to properties in these areas.”
A recent Redfin analysis found that more people have been moving
into than out of the U.S. counties with the largest share of homes
at high risk from natural disasters. That’s partly because some
buyers just aren’t aware of the risks. Redfin.com now publishes
climate-risk data for nearly every U.S. home, with the exception of
rental listings, to help house hunters make more informed
decisions.
“House hunters from out of town ask about climate change because
they’re very concerned about flooding, but most of them don’t
change their minds,” said Miami Redfin agent Cristina Llanos. “They
hear horror stories of hurricanes, but generally still move
forward. People want to talk about it but it typically doesn’t make
or break their decision.”
Heat and Storm Are Most Common Risks Second-Home Buyers
Face
Overall, heat is the most common risk facing second-home
buyers—nearly all (94%) of second homes purchased in the past two
years face high heat risk. Next comes high storm risk, which
plagues more than three-quarters (78%) of second homes bought in
the past two years, followed by high flood risk (26%), high fire
risk (23%) and high drought risk (21%).
Many popular second-home destinations, like Florida and Arizona,
face significant heat and/or storm risk. The most popular
destinations for homebuyers looking to relocate are Miami, Tampa
and Phoenix, which attracted scores of affluent out-of-towners in
search of vacation homes during the pandemic.
To read the full report, including charts and methodology,
please visit:
https://www.redfin.com/news/second-homes-climate-change
About Redfin
Redfin (www.redfin.com) is a technology-powered real estate
company. We help people find a place to live with brokerage,
instant home-buying (iBuying), rentals, lending, title insurance,
and renovations services. We sell homes for more money and charge
half the fee. We also run the country's #1 real-estate brokerage
site. Our home-buying customers see homes first with on-demand
tours, and our lending and title services help them close quickly.
Customers selling a home can take an instant cash offer from Redfin
or have our renovations crew fix up their home to sell for top
dollar. Our rentals business empowers millions nationwide to find
apartments and houses for rent. Since launching in 2006, we've
saved customers more than $1 billion in commissions. We serve more
than 100 markets across the U.S. and Canada and employ over 6,000
people.
For more information or to contact a local Redfin real estate
agent, visit www.redfin.com. To learn about housing market trends
and download data, visit the Redfin Data Center. To be added to
Redfin's press release distribution list, email press@redfin.com.
To view Redfin's press center, click here.
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version on businesswire.com: https://www.businesswire.com/news/home/20220705005157/en/
Redfin Journalist Services: Ally Braun, 206-588-6863
press@redfin.com
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