More than 23% of U.S. homes — representing $11.2 trillion in value — face severe or extreme risk from wind, flood or wildfire, and the financial fallout is already showing up in higher fees, thinning insurance coverage and rising mortgage delinquencies, according to the 2026 Realtor.com Housing and Climate Risk Report.
The Costs Are Already Compounding
Climate exposure is quietly reshaping the cost of ownership well before disaster strikes. Homes in severe or extreme risk areas carry median monthly HOA fees of $192, which is 53.6%, or $67, higher than lower-risk homes, with condos and townhouses seeing a $198 premium. Delaware, South Carolina and Oregon show the widest cost gaps at the state level, while Portland and Washington, D.C., lead among metros.
Meanwhile, the safety net meant to cushion flood losses is fraying. The National Flood Insurance Program saw contracts in force fall 4.5% between May 2025 and May 2026, with Texas posting the steepest drop at 7.8%. The decline coincides with the NFIP’s Risk Rating 2.0 pricing overhaul, which is pushing median annual premiums from $689 toward a target of $1,288 — a cost many households are opting to forgo rather than pay.
Compounding the problem, an estimated 2 million homes worth nearly $1 trillion carry meaningful flood risk not reflected in official FEMA flood maps, leaving owners without a coverage requirement or a clear warning sign, Realtor.com noted.
The financial strain eventually surfaces in mortgage performance. Louisiana and Mississippi posted serious delinquency rates of 1.7% and 1.4% in September 2025 — more than double the 0.8% national average — a persistent scar from decades of storm exposure. Florida and Texas, which started 2023 near the national average, have since doubled their delinquency rates, a trend tied to both direct storm damage and mounting insurance costs.
Buyers Aren’t Backing Away
Despite these costs, Realtor.com shopping data shows demand for high-risk homes remains resilient. In Santa Clara County, California, severe/extreme risk homes are priced at 78% of lower-risk homes per square foot yet draw 48% more views. This is evidence that affordability, not caution, drives many California buyers, the report said.
Los Angeles shows a similar pattern, with risk-exposed homes priced at 75% of comparable properties still attracting 23% more interest.
Even disaster doesn’t shift behavior for long. After the January 2025 Los Angeles wildfires, buyer interest in high-risk homes dipped 10% before fully recovering within a month, the report said.
In lifestyle-driven markets, buyers go further, paying a premium for risk. In Anne Arundel County, Maryland, high-risk homes cost 44% more and still draw more views, driven by Chesapeake Bay waterfront appeal. In Montana’s Flathead County, risk-exposed homes command a 55% premium tied to Glacier National Park access.
The report’s authors argue the fix isn’t steering buyers away from these markets but ensuring the long-term financial picture — future insurance costs, HOA increases, delinquency risk — is visible at the point of purchase rather than discovered years later.
View the report here.