What Can We Learn from Wildfire Disasters?

The recent and untimely death of 19 firefighters in Yarnell Hill, Arizona highlights a fact of life in the West – people continue to build homes in areas that burn the most – and Californians are no different when it comes to building homes where they want to build regardless of the consequences.

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Thousands and thousands of acres of land are devoured by wildfires every summer, putting thousands of homes, businesses, and lives at risk. These fires are exacerbated by recent droughts, and beetle infested tree graveyards.

In this environment is there something a real estate agent can do or be aware of when helping buyers into these high risk homes? Is there something local governments can do such as adopting new maps of the area – even at the risk of depressing property values, increasing insurance rates and suggesting additional regulation?

Just how big is the problem? Corelogic has estimated that there are more than 740,000 homes in the West with a total value in excess of $136 billion that are at high or very high risk of burning up and others estimate the number to be closer to over 2 million homes in high severity fire areas.

And nothing is slowing down the home building these in high fire and dangerous areas. This problem is expected to get much worse, as an additional 12.3 million homes are estimated to be built in these rural areas. Some researchers believe that the spread of these fires will increase by an additional 50% by 2020.

According to Stephen J. Pyne, a fire historian at the University of Arizona, how we live, what we build, and the things we do on this land can have a great influence on the area’s combustibility. With this increase in development, it’s almost certain that more homes are at risk to these wildfires.

This being said, is it an agent or broker’s responsibility to warn their clients about living in these areas? The final decision in buying a home comes down to the buyer, but how an agent positions the threat level can make a major difference in a buyers decision to purchase a home.

Clearly in light of these fire factors, every homebuyer must be properly informed about the risks. Some NHD reports, for example, mention nothing about fire threat levels. Be certain at the least that the NHD report you select does provide a “Fire-Threat Rating.”

But be cautious and realistic – we believe more and more state and local regulation is inevitable – and that will directly affect home values.

In Colorado, for example, they have recently put together a task force to see if there should be fee assessments for those living in high fire severity areas to support firefighting capabilities. Other states are reviewing rates for fire insurance. Some municipalities are putting in place new stringent regulations on construction and management of trees and brush on a property. Because most rural costs for firefighting are born by US taxpayers, it’s possible that federal new regulations will also be enacted.

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