Erasing a home's climate risks on Zillow doesn't make them go away

We live in a golden age of magical thinking, and I’m not just talking about the trillions being burned on artificial intelligence. When it comes to our rapidly heating planet and its effects on our future, too many of us have adopted a strategy of simply ignoring reality to make it go away.

Consider the news that listings on the real estate site Zillow will no longer include climate-risk ratings from the private data firm First Street. The ratings scored each home on its likelihood of being affected by wildfires, floods, high winds, extreme heat and air pollution. The decision follows complaints by homeowners and real estate agents that the listings were hurting sale prices, The New York Times reported.

A house is by far the biggest financial investment most people will ever make. Just an inch of water can do $25,000 of damage, according to the Federal Emergency Management Agency. Homebuyers are increasingly seeking out climate information when making this important decision. Most buyers need home insurance to get a mortgage, and properties at greater risk of climate disasters typically face higher insurance premiums. Meanwhile, few private insurance policies cover floods. All of this naturally hurts the value of at-risk homes, even without Zillow getting involved.

This isn’t a future problem. Flood-prone U.S. counties had a net out-migration of nearly 30,000 people last year, according to the real estate site Redfin (whose listings still use First Street climate scores). Relatively less soggy counties enjoyed net inflows of nearly 36,000 people. Homes at the greatest risk of sea level rise already sell for 6% less, on average, than homes on higher ground, a recent study by Richmond Federal Reserve economists found.

Complaints about First Street climate scores come in the context of the real estate industry being salty about all kinds of data on Zillow and other popular listing sites, Housingwire reported. In addition, it is legitimate to wonder about the accuracy of First Street’s flood data. A 2024 Bloomberg Green investigation compared the company’s flood-modeling output for Los Angeles County with the product of a University of California at Irvine model and found the two agreed just 21% of the time. First Street disagreed with those findings.

The answer is not to ignore the issue altogether, as homesellers, agents and brokers apparently would like us to do. The optimal solution would be for FEMA to at long last update its own flood maps, which have vastly underestimated the real risks for years.

Since 1998, 40% of all flood insurance claims come from outside FEMA’s high-risk zones, or those with a 1% risk of flooding every year, according to the agency. Obtaining a mortgage in those zones requires flood insurance, which typically means going through FEMA’s National Flood Insurance Program, which is chronically underfunded and politically challenged.

In a parallel universe, an attentive White House and Congress would be jumping to make more and better climate-risk information available. In our grim timeline, President Donald Trump and Congress are engaging in their own magical thinking. Climate change is a hoax, according to this worldview, and any acknowledgment of that reality is anathema.

Therefore, Trump has gutted FEMA, and eliminated a program there which helped people brace for floods and prevent future damage. Trump’s energy policy aims for “energy dominance” while starving the country of the world’s fastest-growing energy technologies.

Just as riskless home listings magically cater to people trying to sell you houses, climate-less energy and environmental policies cater to people trying to sell you oil, coal and gas. Buyer beware.

Mark Gongloff is a Bloomberg Opinion editor and columnist covering climate change.