37% of home purchases made by people 65+ occur in counties with high risk of extreme heat, compared with 32% of purchases made by people under 35, and the same trend holds true for flood and fire risk
“Retirees understand the risks of moving to Florida, but many believe the pros still outweigh the cons”
The trend holds true for flood and fire risk; 13.3% of purchases made by people 65+ were in counties with high risk of flooding, compared with 9.8% of purchases by those under 35. And 3.7% of purchases made by people 65+ were in counties with high fire risk, compared with 2.6% of purchases by people under 35.
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Share of home purchases, by age, made in counties at high risk of extreme heat, flood, and/or fire: 2023 |
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|
|
<35 |
35-44 |
45-54 |
55-64 |
65+ |
|
Extreme heat |
32.3% |
35.2% |
36.8% |
37.7% |
36.9% |
|
Flood |
9.8% |
10.7% |
11.8% |
13.4% |
13.3% |
|
Fire |
2.6% |
2.6% |
2.9% |
3.3% |
3.7% |
|
Two or more of the above |
8.3% |
9.1% |
10.2% |
11.8% |
11.8% |
There are a few reasons older Americans are more likely than younger Americans to buy homes in risky areas:
- Many of America’s retirement hotspots are risky for the same reason they’re desirable: They’re exposed to the hot sun and/or the coast. Think Arizona, which is prone to extreme heat and drought, and Florida, which is prone to hurricanes and rising sea levels. Florida is a top retirement destination in part because it doesn’t tax retirement income. But that benefit is beginning to be offset by a surge in insurance costs and HOA fees caused by intensifying natural disasters, along with soaring property taxes.
- Young Americans often gravitate toward major urban job centers—like Boston, Chicago and Minneapolis—many of which face lower climate risk than retirement hotspots in places like Florida and Arizona. Though it’s worth noting that remote work and the growth of Sun Belt metros has upended this dynamic somewhat.
- Older Americans are less likely than younger Americans to factor climate change into their decisions about where to live. Over half (56%) of millennials and exactly half (50%) of Gen Zers say climate change affects where they choose to live, compared with less than one-third (31%) of baby boomers, according to a recent survey commissioned by Redfin. That may be because younger people will have to deal with the consequences of climate change for longer, and because climate change is a major topic in young social circles.
“Retirees understand the risks of moving to Florida, but many believe the pros still outweigh the cons,” said Rafael Corrales, a Redfin Premier real estate agent in Miami. “When I explain to buyers that they can get more bang for their buck and lower flood risk a little further inland, they often tell me, ‘Rafael, we came to Florida for the waterfront views.’”
Corrales said that many homebuyers are now asking sellers how much they pay for insurance and, if it’s a good rate, requesting that the sellers pass along their insurance broker’s contact information. This gives buyers leverage when they’re negotiating with other insurers. Buyers are also considering how much they’ll have to pay for insurance when writing offers, he said.
Redfin broke the findings down by income level, and found that older people of all income levels—not just those who are affluent—are generally more likely to move to risky areas than younger people.
Nearly 100% of homes face high heat risk in places where buyers skew older, compared with 59% of homes where buyers skew younger
Nearly all homes (96.2%) face high heat risk in the counties where 65+ buyers took out the largest share of mortgages last year, on average. That compares 59.2% of homes in the counties where buyers under 35 took out the largest share of mortgages.
This trend also holds true for flood and fire risk. In the counties where 65+ buyers took out the largest share of mortgages, 24.6% of homes face high flood risk and 35.7% face high fire risk, on average. In the counties where buyers under 35 took out the largest share, 16% of homes face high flood risk and 19% face high fire risk.
These findings are based on a Redfin analysis of climate risk scores from First Street, and Home Mortgage Disclosure Act (HMDA) data covering mortgage originations for primary homes. Redfin defines a high-risk county as one that ranks in the top 10% when it comes to the share of homes facing high fire or flood risk, and the top 33% for heat risk. Climate risk scores are based on a property’s current risk as well as how that risk is expected to grow over the next 30 years.
