Zillow will no longer show climate-related data on its home listings after complaints that it’s hurting home sales.
The listing giant is taking down the tool it introduced last September to show potential buyers the threat of wildfires, flooding, extreme heat, wind, and air quality on many listings.
The move came as buyers are increasingly forced to factor in weather safety when shopping for a home. The cost of increasingly common disasters – as well as the prohibitively expensive cost of home insurance in many climate-affected areas – is no longer something Americans can ignore when choosing a place to live.
“Insurance is increasingly the final gatekeeper to homeownership. Without coverage, there is no mortgage. Without a mortgage, the ladder disappears,” a recent climate impact report from Cotality noted.
But real estate agents and a handful of homeowners have complained that the climate data is impacting their sales. They further allege that the rankings seem to be “arbitrary,” The Guardian reported.
One organization that lodged a complaint? The California Regional Multiple Listing Service. California is a hotspot for devastating wildfires, with extreme damage making it all the way into the Los Angeles metro last year.
Florida, Louisiana, and California are projected to account for 53% of all climate-related mortgage losses in 2025.
Rick Sharga, president and CEO of CJ Patrick Company, said insurance companies need to carefully monitor extreme weather patterns across the country to determine where it makes sense to issue policies and how to price those policies.
There’s a limit to how much homeowners can pay for hazard insurance, he said.
“Home affordability today is already worse than it’s been in the past 40 years, and many homeowners who just barely qualified for a mortgage may simply not be able to handle insurance premiums rising by hundreds – or even thousands – of dollars a month,” said Sharga. “So, there are implications for the housing market, and home prices in general tied to hazard insurance rates.”
One recent risk model from First Street suggests that “climate-driven foreclosures” could bring $5.36 billion in annual bank credit losses by 2035, nearly 30% of all foreclosure losses.
“Ultimately, the climate folks at financial institutions see climate as an emerging risk and are pivoting from integrating the data for regulatory compliance to thinking about how the impacts might link back to mortgage and investment performance,” Jeremy Porter, head of climate implications at First Street, told Axios.
