Redfin's CEO stated to CNBC that he believes the United States has not yet begun to recognize the dangers of climate change.
Redfin's Glenn Kelman stated that "The buyers just keep marching towards the jaws of disaster," during an interview with "Closing Bell"
The American West's wildfire season is getting longer and more intense due to human-induced climate changes. This has been fueled by warmer temperatures, and dryer conditions. Scientists also believe that floods and hurricanes are becoming more severe due to rising sea levels and a warming planet.
Kelman stated that homebuyers in the most vulnerable areas of the country don't need to be discouraged by these realities. Kelman stated that buyers are motivated by affordability and the most vulnerable areas of America are those most at risk from climate change. They'll be flooded by the hurricanes. They will be affected by wildfires.
"If you look at the places people are moving to, it's Florida and the Southeast. This area is particularly flood-prone and has an incredible heat risk due to rising temperatures. Kelman stated that they are also moving to Utah, Las Vegas, and Phoenix.
According to recent 2020 census data, Phoenix is now the fifth largest city in America. It has overtaken Philadelphia. This is after the Arizona capital grew more quickly than any other major American metropolis in the past decade. Phoenix is located in the Sonoran Desert and has been well-known for its heat. However, experts warn that climate change will make it more extreme.
According to the Census Bureau, Utah's population grew by more than 18% in the period 2010-2020. This makes it the most populous state in the United States. Kelman cited a Redfin analysis which found that more than one third of Utah's homes are at "high fire danger."
"I believe that the idea that climate change will be considered in housing decisions is a good one, but it hasn’t yet. Kelman, who has been leading Redfin for around 15 years, said that the only ones who have solved the problem are the [actuaries], who must calculate the cost to insure these properties."
He said, "Increasingly it will be harder to obtain insurance and it's going be harder to borrow money for these properties, because lenders are going see the writing on wall, that this collateral's at risk."
Natural disasters can be costly. Munich Re, an insurance company, estimated that $210 billion was caused by natural disasters worldwide last year.
Kelman's Friday comments come at a time when many regions of the U.S. are dealing with severe weather. Crews in California are fighting two massive fires known as the Caldor or Dixie fires. The latter is the second largest recorded state-wide blaze. Residents have been forced to evacuate their homes by the wildfires.
Other parts of the U.S. are still dealing with the effects of Hurricane Ida. It made landfall in Louisiana on Sunday. According to the state's Public Service Commission, close to 850,000 customers were still without power as of Friday noon.
After weakening into an tropical storm, Ida made its way north to pummel mid-Atlantic, Northeastern and New York states. New York City was hit with record rains Wednesday night. The flash flooding that followed showed how vulnerable the infrastructure of the nation's largest city to climate change.
