Older homes for sale in California now come with wildfire warnings

"Most California homes were built long before the state required that they be constructed to withstand wildfires. Now, sellers of older homes in high-risk areas must disclose to potential buyers not only a dwelling's susceptibility to fire but what they've done to address those vulnerabilities. As climate change intensifies natural disasters, states across the US have been mandating that home sellers disclose risks such as flooding. But the California disclosure is the first to zero in on a property's ability to survive a catastrophe."

"That could make the state a model as wildfire and other climate threats endanger homes across the US. While three dozen states require some degree of flood-risk disclosure, only California currently mandates home sellers reveal wildfire hazards. The new California rule requires sellers to list specific features that endanger a house, including combustible roofs, uncovered vents, single-pane windows and vegetation within five feet (1.5 meters) of a building."

""When you require disclosure, you see effects on home prices," said Margaret Walls, a senior fellow at Resources for the Future, a Washington, DC-based nonprofit research institute. RELATED: How to defend a home from wildfire: UC Berkeley researchers' lessons from infernos Walls and other economists' research has shown that disclosing climate risks results in lower home prices, but that buyers are willing to pay more for safer properties. That, in theory, should motivate sellers to improve their homes' resilience to climate risks. But such outcomes need to be validated by further research, according to Walls."

Most California homes were built before wildfire-resistant building codes. Sellers of older homes in high-risk areas now must disclose fire susceptibility and any measures taken to reduce vulnerabilities. California's rule uniquely focuses on a property's ability to survive catastrophes compared with other states' flood-risk disclosures. Economists find that climate-risk disclosure tends to lower home prices while buyers pay premiums for safer properties, potentially incentivizing resilience upgrades though further research is needed. The rule specifies hazards such as combustible roofs, uncovered vents, single-pane windows and vegetation within five feet. Disclosures can affect homeowners' insurance approvals as insurers limit exposure in disaster-prone areas.

Read at The Mercury News