 "Hurricanes, floods and wildfires don’t deter America from building homes in climate danger zone")
As the US grapples with a massive housing crisis, a potential solution to it has taken a damning turn. According to an analysis by the Financial Times, American real estate developers are building in places considered prone to climate-related disasters, including hurricanes, floods, wildfires and extreme heat.
The analysis, based on data from CoreLogic, a property information services company, and the climate risk rating firm First Street, reveals that overall 39 per cent of houses in the US are built in high-risk zip codes.
In 2014, around 49 per cent of all houses made that year cropped up in high-risk zip codes. In 2023, the percentage of such houses shot up to 57 per cent.
It’s about profit
Among other factors, profit is driving builders to these high-risk areas, often located close to oceans.
Coastal communities already make up 40 per cent of US population. But that figure is slated to rise as selling homes near oceans is highly profitable for the sellers.
In some cities and counties, such risky development is also linked to higher revenue prospects for local governments. Many governments rely on property taxes to fund their annual budgets. For example, take Charlotte County in Florida. In 2023, around one third of the county’s revenue came from property tax.
People moving to risky areas
The development in risky areas actually follows the migration trend. The USA’s ‘Sunbelt’, consisting of states like Texas and Florida, has attracted massive immigration over the past years owing to economic growth and relatively large immigrant communities.
According to data from brokerage firm Redfin, in 2023, an estimated 60,000 more people moved in to high risk American counties.
America’s housing shortage is a major driver for new construction. According to government-backed mortgage firm Freddie Mac, the country was short by 3.7 million housing units as of the third quarter of 2024.
Impact Shorts
More ShortsIn Phoenix, Arizona, developers cited this shortage and affordability issues in a lawsuit filed in January. They challenged local officials who had restricted residential construction due to long-term concerns about groundwater supply.
It shows the housing crisis is real and we can’t escape this reality, warns s Miyuki Hino, a professor at the University of North Carolina at Chapel Hill.
“We’re not just going to develop in places that are perfectly safe from all hazards because there’s no such thing.”
(With inputs from agencies)
 "Russian drones over Poland: Trump’s tepid reaction a wake-up call for Nato?")
 "As Russia pushes east, Ukraine faces mounting pressure to defend its heartland")
 "Why Mossad was not on board with Israel’s strike on Hamas in Qatar")
 "Turkey: Erdogan's police arrest opposition mayor Hasan Mutlu, dozens officials in corruption probe")
 "Russian drones over Poland: Trump’s tepid reaction a wake-up call for Nato?")
 "As Russia pushes east, Ukraine faces mounting pressure to defend its heartland")
 "Why Mossad was not on board with Israel’s strike on Hamas in Qatar")
 "Turkey: Erdogan's police arrest opposition mayor Hasan Mutlu, dozens officials in corruption probe")
