CoreLogic Report Finds Idaho, Wyoming at Disproportionate Economic Risk for Wildfire
You’d think that when analyzing wildfire risk, California would be at the top. But a CoreLogic analysis of additional factors, such as reconstruction resources and economic recovery potential, found that Idaho and Wyoming are the states at most risk.
The CoreLogic annual Wildfire Report for 2021 said while California traditionally tops the list each year for wildfire risk simply because it’s the most populous state, its approach for this year’s report examined property-related wildfire risk alongside reconstruction resource availability, temporary housing capacity for displaced individuals, and community economic recovery potential among fire-prone regions. By analyzing this risk through a housing stock comparison lens, CoreLogic identified Wyoming and Idaho as the states most at risk for a prolonged wildfire recovery.
The report noted if a fire destroys 800 homes in California, the road to recovery and lasting impact is not synonymous with 800 homes burning in Wyoming, when considering the size of each state’s housing stock. In states such as Wyoming and Idaho, the number of homes at risk is a larger fraction of the total number of homes in the state. If a larger portion of the population is displaced at a single time, recovery times may be elongated, fewer local workers might be available — and likely distracted rebuilding their own lives — and fewer hotels and housing options may be available to outside workers due to local populace demand.
“There’s no denying a state like California is at severe risk for wildfire destruction every year, as seen in the ongoing Dixie Fire,” said Tom Larsen, principal of insurance solutions with CoreLogic. “But it’s important to acknowledge that not all communities and their catastrophic events are the same, and the road to recovery can look drastically different. Resilience is often measured as how fast you can recover from a catastrophe — and the deeper the wound, the longer it takes to heal.”
Within these states, CoreLogic identified the five counties at highest risk. These counties, if impacted by wildfire, would likely have a longer and more difficult road to recovery than counties in more populous states.
The report warned the changing climate creates abnormal weather activity, such as unusually high rainfall during seasons of vegetative growth, that then creates an overgrowth of plants known as ground fuels. “The environment is changing too rapidly to rely solely on wildfire loss history to plan for future wildfire mitigation and response,” the report said.
In a report last week, the Mortgage Bankers Association’s Research Institute for Housing America said climate change triggered by global warming will continue at an unpredictable pace and will add stress to the complex system of allocating risks across housing and housing finance stakeholders. The study, The Impact of Climate Change on Housing and Housing Finance, identifies wildfires as a major threat to homeowners, mortgage lenders and mortgage servicers.
