Last week’s decision by Realtor.com to explicitly identify a home listing’s flood risk is a gutsy one, and one which the real estate industry should consider emulating.
The listings site has partnered with nonprofit researchers First Street Foundation to present the latter’s Flood Factor data for every listing on the site. First Street’s research includes four types of flooding events – riverine, rainfall, storm surge and tidal sources – and includes many properties not identified as flood risks by Federal Emergency Management Agency.
Extreme weather events like Hurricane Laura, which last week tied the record for the strongest storm to ever hit Louisiana since record-keeping began in 1851, are thrusting climate change into the public consciousness with greater frequency. And it is undeniable that, in the aggregate, the risk from coastal flooding and inland flooding tied to severe storms is getting worse as the world warms.
The risks of flooding and sea level rise are familiar to Massachusetts residents, and many have seen the evidence of this – like dumpsters floating down Atlantic Avenue and Seaport Boulevard – with their own eyes.
As a comparison of current FEMA flood risk maps and the data presented on Realtor.com shows, the real danger to homebuyers lies in properties near known flood zones but where flood insurance is not currently required, or in inland areas where a severe storm could back up local drains and inundate lower-lying homes. First Street has identified scores of properties in areas like Cambridge, Roslindale and Dorchester that could find themselves underwater at some point in the future precisely because of these details.
Buyers, who are making the biggest investments of their lives, deserve to know about a home’s climate change risk factors just like they deserve to know whether the home’s boiler could need replacement soon.
The challenge comes in describing flooding risk without unduly alarming buyers and destroying a home’s value. First Street’s scores are based on the 30-year life of a mortgage, which is not necessarily the average length of time a buyer will stay in a house. Other major listings sites are reluctant to put flood risk data online out of fear that sellers would push back, fearing a hit to their property values.
Realtor.com seems to have struck a reasonable balance. Both FEMA’s and First Street’s evaluations are presented, and they and the map of area flood risk are given equal visual weight to other data like school district quality or noise pollution.
It will likely be up to the market to manage our response to the risk climate change poses to our homes by pricing that risk. This makes Redfin’s and Zillow’s reluctance to join Realtor.com unfortunate. As apparently rigorous as First Street’s data is, it’s an axiom of real estate that more competition is better. If those companies were to apply their considerable internal brainpower to the issue, consumers would be better served.
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