According to a 2015 U.S. Natural Disaster Housing Risk Report conducted by RealtyTrac, one of the leading source for comprehensive housing data, 35.8 million single family homes and condos in the U.S., with a combined estimated market value of $6.6 trillion, are in counties with high or very high natural hazard risks. Those 35.8 million homes represent 43 percent of the 83.4 million single family homes and condos in all the counties analyzed for the report.
RealtyTrac vice president Daren Blomquist said that prospective buyers and investors should be aware of any natural disaster risk impacting a potential home purchase, in order to protect their biggest financial asset as well as to ensure their personal safety.
"In most cases learning about natural disaster risk will not stop a home sale, but it will help buyers make a better-informed decision about where to buy and also be prepared in terms of appropriate insurance coverage and family contingency plans depending on the type of natural disaster risks most affecting the home they end up purchasing," Blomquist explained.
The report also includes that states with the most homes in High Risk or Very High Risk counties for overall natural disaster risk are California (8.4 million), Florida (6.7 million), New York (2.4 million), New Jersey (2.3 million), and North Carolina (2.3 million). Metro areas with the most homes in High Risk or Very High Risk counties for overall natural disaster risk are New York (3.5 million), Los Angeles (2.5 million), Miami (1.9 million), Houston (1.2 million), and Riverside-San Bernardino in Southern California (1.1 million).
RealtyTrac analyzed five different natural disasters posing a risk to housing, namely, earthquake risk, hurricane risk, tornado risk, flood risk, and wildfire risk. Based on these five factors, each of the counties evaluated was assigned a combined natural disaster risk score from 0 to 300, with 300 representing the most risk (190 was the highest score among all the counties).
Based on these scores, counties were assigned one of five different categories of risk of natural disaster: Very High Risk (score of 90 or higher); High Risk (55 to 89 score); Moderate Risk (30 to 54 score); Low (15 to 29 score); and Very Low (0 to 14 score).
The 551 counties analyzed for 10-year and three-year home price appreciation only included counties with at least 10,000 single family homes and condos, and excluded counties where historic home price data was insufficient.
