Episode #70: Zillow looks to provide transparency through climate risk scoring

[00:00:00] 99.9% of all homeowners policies they exclude flood okay oh I didn't know that yeah I don't know that either if you want flood coverage you can buy a flood policy but it's almost like you have to be the one to almost ask about it unless it was like I guess glaringly obvious from where the property sat right like if if it wasn't in a FEMA flood zone would it really be more the consumer asking you hey what about flood insurance do I need flood insurance like here's what I say to that is every every

[00:00:29] home in America is in a flood zone right yeah whether now whether you are in a one in a 100 year zone yep or a one in a 1000 year zone is that really those are the gauges that's how they kind of give you that like what's the what's the um likelihood yeah or you know how they kind of rate it out welcome to the podcast dedicated

[00:01:05] to real estate insurance and building your business join us as we take you along our own business building journeys with additional wisdom from our network of local and national experts welcome to bricks and risk hey everyone welcome to another episode of bricks and risk I'm Timmy G and I'm Sean Mooney what's going on homeboy what's going on

[00:01:37] um nothing what was going on last night we had our bricks and risk community outing night we did our second bricks and risk networking happy hour we had it right here at bar john in maniunk what's up Dave and Anna hey bar john great night great event great place to have an event um food and drink were spectacular what was your favorite pizza

[00:02:06] I only had one did you just have the plane no I had pepperoni okay I didn't get to try I think it was called like the john or the bar john was like a white pizza oh and that one like I literally went up to get pizza and it was it was gone already so I think I saw a picture of that one on Instagram yeah like that looks like we should have gotten three of those

[00:02:28] but all right let's get a lot of those but all right let's get a lot of those but all right let's get like the pepperoni uh had like like peppers like hot peppers on it yeah nice stuff all right what are we getting into today um Keon was actually at the event last night what's up key why don't we read his listener watcher review first hit it up so this one comes from Keon Whiting it's titled

[00:02:56] Super Great Podcast and it reads this is a great podcast super insightful and educational can't wait for more upcoming episodes thanks Keon appreciate the kind words man glad you're enjoying it I'm trying to persuade him to start his own podcast oh yeah there was some chatter last night people had podcast questions

[00:03:20] yeah which we love like I love coming across people now that say hey can you introduce me to Dylan Terry at Yunk Junk because I'm interested in learning more about the studio about what they offer about you know what the opportunities are to do some video content some podcast content

[00:03:40] especially key on um being on the show seeing the setup and then talking about like where we started with the podcast where we are now the kind of reach we're getting the kind of views we're getting yeah I think it just starts to you know get the gears going in terms of like man could I do that would it be worth it you know yeah so I think it's uh yeah a lot of good conversations and I you know I told him I was like there's anything that we can do let us know happy to help

[00:04:09] yeah so awesome all right what are we get into today so today's episode we are going to be talking about Zillow and their online site and how they're rolling into um listings kind of like I don't know if I would call it an added feature yeah I would say it's an added feature so what they're doing is uh on each listing that they have they're going to give you a climate risk score right up your alley man yeah

[00:04:39] um so uh we'll get into that in terms of how it's detailed and what's kind of baked in uh to the to the scoring what are your initial impressions on being at let's say you're a consumer Zillow is a consumer facing residential real estate based website yeah and you're an insurance you're in the risk business yeah what are your thoughts on them putting that feature out there not only for someone like you who's educated

[00:05:09] but for someone who's not so I like it I don't I don't like just to start not Zillow specific right anytime that there's more information yep for the consumer uh I'm for it right so

[00:05:31] whichever way you want to slice it or dice it if the consumer who's searching for in this case a property right anytime you have more information for the client I am pro that yeah me too I mean there's lots of different things that Zillow has on there they'll have like a walk score sometimes they'll have like a biking score yep because like they just want people to learn about these properties through their portal they're basically

[00:06:01] in the information business they're in the portal company exactly yep so I agree I think this is a good feature not only for consumers I think it's good for agents I think it's another opportunity for people to get educated about things like someone such as myself saying hey if you're concerned about that did you look at the feature on Zillow about the climate risk it's bringing awareness exactly and providing a little

[00:06:26] bit more depth of information for the consumer yep totally agree so here's a really interesting stat and let me know if you agree with this so when we pulled up this article this came from the nothing divided by nothing equals nothing sheet who came up with that uh you right I mean I think everyone knows by now I would never name something that but hey you know to each their own yeah um it said more than

[00:06:51] 80 percent of potential home buyers now consider climate risks when choosing a home so eight out of ten four out of five when they go look for a property now they use that as a consideration of should I buy this asset I don't know if I agree with that number it seems a little high I'd like to see um like they

[00:07:15] pull it from here and they say this um you'd like to see the data behind it yeah um because if you think about it um you work with buyers yep I don't know if many are coming to you with those questions to say you know how many beds how many bathrooms what square footage and and oh is there uh a likelihood

[00:07:42] of brush fire yep or flooding or you know yeah I don't think it's top of mind for a consumer so I think it's more I think it's more they pull people and they say hey are you concerned with you know environmental hazard and they say oh yeah yeah yeah it is yeah I think it's probably more like so

[00:08:03] that's where you get it plus the person polling um the information the more likely it is for them to get a higher number then they can go to Zillow and say look 80 percent of the people that we polled are interested in this you want to have this on your site right right right no I think it's a very fair point so I think I think that uh this particular number without knowing all of the detail might be

[00:08:33] higher than what I would expect I would agree and so I'll give a little bit of a real estate perspective on this one so let's say that's true and 80 percent of people consider climate risk before evaluating a home to buy or at least it's on their radar of what I want to know what the climate risk is or not I'm going to say a lot of people would say yes well the other thing too is are all these people in

[00:09:01] California right right so like if it's a California specific poll those numbers are going to be much higher because you have a lot more right climate risk in California I'll give I'll give two really good examples for myself recently one was I had a listing around here locally and uh the home was next to like what I would consider like a smaller creek I don't even know the name of the creek

[00:09:26] creek or creek I say creek you say correct correct like correct shoes yeah oh okay um so the home is next to a creek but the creek was pretty low like you never know sometimes around like creeks or rivers like the the land is kind of flat around it so therefore it feels like more of a risk this one was like probably like 15 foot differential between where the house sat and where the creek was and I

[00:09:53] will tell you listing that property it took a little bit to sell the number one concern that either buyers or agents were asking me about before like trying to either show interest or get more information about the home was what's up with the creek they would literally say like what's up with that and I'm like okay well if you look at a FEMA flood map you're gonna have to have flood insurance because it's right there so so there's that risk what concerns do you have about the creek like what are you worried about

[00:10:22] well has the creek ever flooded to the point where it's reached the home and the people that were there were living there for many decades and it had never made its way into the home which was good so that's one instance where it's like I'm selling this property on face value like why would this be an issue it's it's far away but yet almost every person agent or buyer like asked about it to understand

[00:10:47] what kind of risk is is the creek and then the second one is a developer client of mine we were looking just for like a lot opportunities in and around like my area and there was one like not too far from me I was like did you see that sign out there for that particular lot and without me even thinking he's like dude that's like totally like in a floodplain it was like the first thing out of his mouth not like it's overpriced or I have to you know maybe take down some trees or some shrubbery and level out the

[00:11:16] ground in order to build there his first thought was like dude that's totally in a floodplain and I'm like well there's a couple homes right around there he's like yeah but those are older homes and my guess is they've probably had flooding issues over time so it's almost like going forward now he saw the risk of like I don't even want to I don't want to know anything even about the numbers knowing that the proximity already has to that creek which I thought was interesting and I would say like

[00:11:44] in my 15 years of residential real estate it hasn't really come up that often up until like the last like few years with some of the storms like maybe after sandy I think sandy was probably one of the bigger ones that impacted our our immediate area that I feel like it's just on people's minds especially from like the south jersey shore and you know everything that happened the rivers in and

[00:12:06] around philly yeah um sandy was a big one um in our area I think actually Ida could sandy actually and I'm only aware because yeah claims and all of that sandy wasn't that big in our area it was actually it was the week after so it was like sandy came through and just dumped a whole bunch of rain

[00:12:32] yep and everything was like saturated and then I think it was maybe not a week but uh a few days after that specific date um there was another storm where we got a lot more because sandy was more you know jersey coast yep and came in that way but we had a storm uh a few days after and and that was like everything had been waterlogged and then that storm came in with wind with winds because that was

[00:13:00] once everything gets wet all the trees and everything get loose and and then when it comes through with wind everything just falls over more there's only so many places water can go so if the water if the ground is full of water from a storm when you get another storm it's just going to start overflowing um here's a question yeah yeah um if you wear crick shoes where do you

[00:13:23] wear the crick shoes to to the creek to the creek you've always said crick crick that's funny but isn't it why wouldn't you call them creek shoes i would go to the shoes i was making a joke about your accent earlier that's why i said crick shoes yeah so just so we're clear everyone just wanted to get that defined um so let's talk about um from an insurance standpoint

[00:13:51] like the fact that 80 percent of people now consider climate risk when buying a house how do you look at that from like let's call it mooney insurance brokers like why does that matter to your business versus like when someone wasn't really talking about it like years ago let's say well i think it's getting people more informed um so it's like i said before bringing the awareness

[00:14:18] to the consumer so i like it generally speaking because it's prompting people to maybe ask more questions to get into more conversations about hey what like this is the score this is what this is telling me for a flood exposure there's like a gauge now yeah oh this one's an 85 i mean i'm just throwing a number out there yeah but you'd be like oh yeah 80 85 yep you know that's that's high

[00:14:47] up yeah that's going to be more expensive like think of this think of that um so having the consumer be more aware is always good right and it opens the door for a deeper conversation about the coverage under your homeowners oh how does this impact well first off flood is always excluded under 99.9 percent of all homeowners policies they exclude flood okay oh i didn't know that yeah i don't know that either

[00:15:16] if you want flood coverage you can buy a flood policy but it's almost like you have to be the one to almost ask about it unless it was like i guess glaringly obvious from where the property sat right like if if it wasn't in a fema flood zone would it really be more the consumer asking you hey what about flood insurance do i need flood insurance well here's like here's what i say to that is

[00:15:37] every every home in america is in a flood zone right yeah whether now whether you are in a one in a 100 year zone yep or a one in a 1000 year zone is that really those are the gauges that's how they kind of give you that like what's the what's the um like likelihood yeah or you know

[00:16:04] how they kind of rate it out interesting yeah and it's an x zone an a zone a e zone um are some of the common ones but having that conversation to educate the consumer oh i didn't know that oh how flood okay 450 for a flood policy oh well that seems you know like something i'd i'd like to have

[00:16:27] yeah right or well if it's not flood if it's if it's coverage in my home because a lot of we get that a lot too is people think oh water is flooding like a broken pipe is flooding right right it's not yeah but it allows the conversation allows people the consumer to better understand what the coverage

[00:16:51] is going to be under your homeowner's policy and then obviously separately under a flood or an earthquake or you know something beyond the traditional home policy how common would you say so just doing like homeowners insurance in and around philadelphia how common is it that your clients have you know like what would they call it a flood rider or just flood insurance that people

[00:17:19] get flood insurance as part of their homeowners insurance how how common is it these days is it like 50 is it like 10 so the vast majority when it's bank required so if your home is located in a zone where the bank is going to require 100 of the time the bank's going to say you need this and there's home and that is the requirement so that's based off of fema flood maps and things like that that's what they say you need it or if you're in this zone you're yep exactly uh and actually remember i don't

[00:17:47] know if you remember the there was a building in amber that i was looking at years ago that actually yeah had had the uh had that little had that little crick running behind it yep um and so uh that one for me was part of the reasoning why i you know didn't want to pursue it um not the only reason but one of

[00:18:11] the reasons interesting um but outside of that the normal consumer like what percentage of people decide to just opt in for the coverage that you see um i would say probably if i had to pull a number 20 percent okay 20 25 percent like one out of five one out of four saying you know i want to learn more about flood insurance for whatever reason no i like like add like like i want that like we get in a

[00:18:39] conversation floods excluded okay i want that can we talk about it yeah yeah yeah add that on to my coverage wow interesting that's harder than i thought actually yeah um all right so let's talk about this kind of like from like zillow's perspective yeah you know zillow again consumer facing portal providing information and data for people looking to buy real estate sell real estate rent real estate

[00:19:01] invest in real estate but zillow is also an agent facing portal meaning agents pay money to zillow to meet more clients they want leads they want opportunities and they have all sorts of different programs one way i think zillow has uh looked at this in a strategic way is they're like if we're a data company we're gathering data and there's value to the data why don't we add some more data for

[00:19:30] something that comes up more often which is you know uh climate risk and what i think they did that was really smart rather than just like reinvent the will be like oh like let's do our own research let's do our own study like let's put up the zillow whatever they partnered with a company called first street which you said you heard of um and first street's website it's pretty interesting it says we leverage the most advanced climate science and engineering approaches to quantify and communicate

[00:20:00] the risk for every property in the country like that's a pretty feel good statement as part of their mission meaning they're like we want to look at every single property in the united states of america and we want to give it a score a grade we want to show what the level of risk is on it and then zillow kind of just like swooped in and said like hey why don't we work together instead of working against

[00:20:27] each other like why don't we do our own thing we'll have the zillow uh gauge they went to uh first street and said can we use your data that's already been done and you know you guys specialize in this can we do that and connect it to our site and i'm sure both of them are getting something out of it i mean there's no doubt yeah but it's also it's good for consumers it's good for agents like you said it's it's adding transparency like it's good to get information like that because that way you can assess

[00:20:57] risk before you buy something here's where i don't know where it goes i think that um i can imagine a scenario where you're selling your house and your score comes back pretty bad and they someone like says why are you ruining the value of my property by having that data out yeah yeah so here and what what brought to mind one scenario that we deal with um from an insurance perspective is we've talked

[00:21:25] about this in previous episodes is roofs and roof age and insurance companies now because of access to drones and yeah satellite imagery and and all of that um they're starting to score your roof really yeah so like when we put in an address to write homeowner's insurance like a one out of ten one out of a hundred one out of a hundred they're going to score you and i don't know what i don't know how

[00:21:52] the inputs are are taking to get that score yeah like that algorithm but uh i imagine it's a multitude of you know county sites giving you know roof permits and so that they can pull that to see oh it was done in five years oh this is we're going to give it a good score bleeding uh leeching on the actual

[00:22:15] roof itself like roof staining you can kind of see and over time like that's the other thing too is they can do time lapse oh wow so they can see staining up to five years ago and then that stain is all gone and it looks like a new roof so that the ai systems that they're using can almost make the decision

[00:22:41] or at least an inference on that data that have an opinion on it this is a newer roof that roof was replaced that's crazy yeah so it's all modeling that they're using yeah to come up with these things but i have to think that if they were to implement that type of thing like if zillow was to take it upon

[00:23:04] themselves to take that information and say hey in in addition to the uh walk the climate score we're going to give you a roof score so that the buyers know what condition this roof is like someone's going to be like you gave me a an 82 that's hurting my roof is brand new why am i on an 82 yeah well here dude i got a really interesting like comparison like an analogy because you're

[00:23:31] saying like look if zillow puts that information out there and a consumer looks at it and says i don't want to buy your house or i want to pay a lot less because your your climate risk score yeah is high yep then the seller would technically have grounds to go to someone like zillow be like hey like you can't just be like putting this information yeah financially harming me right yeah so here's i'll give you a really good example of something that's not the same but like similar and this happened when

[00:23:58] i was living in philadelphia in the rocksboro section that um in the city all the time they want to shout out rocksboro shout out to rocksboro they in the city they want to preserve history they want to preserve architecture they want to preserve uh the look of things structure like you go to chestnut hill if you're from in and around this area you know there's like belgium block in the streets still like all the places look super old why is that it's historically designated so the story was that

[00:24:27] everything along ridge avenue there's a lot of big lots a lot of favorable zoning they were starting to tear down some very architecturally significant buildings and then they were building like new construction apartments or mixed use or whatever and people were up in arms like why are they just able to like tear these things down so then the city got involved and after much back and forth they designated a large portion of ridge avenue as historic historic preservation historically protected

[00:24:57] from people tearing things down or whatever is peck miller's part of the historical um protection technically yes yeah it is really i mean it's all it's all along that i didn't know if it was like a certain set of blocks or if it was like the wide expanse of actually you know what now that off the top of my head i think it there are it's like spotty it's not like a hundred percent maybe it's like 80 percent or whatever this this block and this was built in 1965 they're like tear it down if it

[00:25:23] went yeah kind of thing um but i do remember conversations with neighbors because i was part of the roxborough development corporation back then and they're like this is devaluing my property because they were like what if i want to sell it to someone for the land and i want them to tear it down and build because my land is worth more than the house that sits on it it's just like the size of the lot

[00:25:48] was was the valuable piece or if someone owned a property and someone wanted to buy the property let's say not for the land before the home they're like now they have to like follow the guidelines of the historic designation okay you got to put wood windows in they're more expensive you can't mess with the facade you know if there's a light involved it has to be this kind of a light so now the cost to

[00:26:12] rehab or repair goes up significantly for the person buying the property so yeah there were i know for a fact home sellers and home owners that were up in arms about the historic designation i'll give you one even better yeah please on the insurance side of things so on the on every application is this home designated on a historical registry really yes reason being every application yeah reason being

[00:26:41] the insurance company wants to know if this home has a claim oh wow the reconstruction cost going to be more expensive way more wow i never thought of that most insurance companies don't want it right so they ask yes decline is there like a public record system for historically yeah so where it gets weird what i've found because i've had these risks come up with clients buying these properties

[00:27:08] yep is that there's a local historical registry there's a federal historical registry and i think a statewide oh really yeah which one's the is federal the highest federal being yeah and they probably have access to the federal one yeah gotcha so it just creates these layers from an

[00:27:31] insurance perspective where we don't want it like we don't even want to bother with a home that's designated uh you know a historical home because there's so much more red tape there's so much more uh i mean if you think about the engineering the the materials that you would need to kind of right be acceptable builder grade is not acceptable and the zoning and and everything that you would need to

[00:27:59] to go through the hurdles to get compliant with that yep it's just they don't want it interesting yeah hey everyone this is tim your favorite bricks and risk co-host but don't tell sean i hope you're enjoying this episode and i'll get right back to it in a moment our audience grows through word of mouth so if you would please take a moment of your time and give us a review on the platform you're on

[00:28:27] that would be fantastic please also help spread the bnr word by sharing your favorite episode with a friend we greatly appreciate your time and trust now back to the show all right so back to uh first street so there's five key climate risks yep that they're looking at as part of this score that's going

[00:28:52] to be on zillow yeah so it's flood wildfire wind heat and air quality yeah which is interesting yeah is air quality how does air quality play into insurance does it or does it not i mean maybe in different areas of the country i'd assume maybe potentially um but nothing that i've ever seen

[00:29:17] um okay do you agree with those do you think all those like what's is heat just like how hot like if it's in the desert like the the heat could potentially ruin like the quality of your property i don't think it i don't think it's measuring it with specifically to insurance right this is more for

[00:29:38] the consumer yeah that oh in this area your property may have like scored uh an average home temperature above 80 degrees for the year or or some right yeah calculation to let you be aware like if you're moving from chicago to phoenix right you might want to be aware you know that gets up to a buck 15 buck 20

[00:30:02] in the summertime yeah um air quality obviously in like you know urban cities yep that's going to be a concern so i think it's just something that they put together as um into key indicators for you know consumers to be aware of that's interesting yeah all right so here was another thing i thought was interesting from uh first street so they said they're there to protect now get this number

[00:30:30] real estate in the u.s is worth over 45 trillion dollars so you think about all the real estate in the u.s is that's what they're we're gonna have value dylan do like a um a graph or something and and try to like fill this room with we're gonna show him his iphone he's gonna be like using the

[00:30:55] iphone calculator yeah and how many calculating 40 which is 45 what is 45 trillion look like on a calculator yeah um so and it says they want to protect values through data so i think this goes back to your original question i think it really goes both ways if you're a buyer and you're looking at a website like a portal like zillow to shop for a home you seeing this uh climate risk score is going

[00:31:23] to be valuable to you because it helps you determine which home which asset you potentially want to buy now the flip side is that maybe a seller who didn't have this climate risk score before on zillow now that it's out there it could be devaluing their home because everyone's seeing this stuff so then there's the argument there and honestly it really comes back to what you said the the word

[00:31:50] you said was transparency and i think you know you and i we run our businesses these these ways our lives being transparent with clients open and honest honesty is the best policy i actually think this transparency is a good move for everyone while there might be a subset of sellers who will be upset there's also a subset of buyers who were upset by not having this well so the solution being i think

[00:32:17] if if your home gets listed zillow scores it out there should be should be uh like a delete button like if you don't want us to have this score you're saying that the homeowner slash seller should have an opportunity to say i don't want that out there yeah well it's like um okay so to draw a parallel google google has every a picture of every home in america yeah right right if you

[00:32:48] didn't sign up for it you can email google and have them blur out your house oh yeah i have seen that yeah that's interesting because i that's that's my i don't want i'm a private person i don't want yeah i don't want people looking at my stuff yeah or potentially me walking outside because sometimes it catches human beings still right um that like that guy on tiktok who's like i was in my boxers that that day in my terry cloth robe i like when they they they shoot by on the car

[00:33:17] and the guy gives the middle finger yeah those are my favorite that show up on the map right but they blur out the finger yeah um but they're so similarly just as google gives you an opt out right i think something like this should be uh a scenario where and it probably be good for zillow if they don't catch a lawsuit uh by a bad score or something okay but overall generally speaking the

[00:33:46] information more information for the consumer including this in terms of a score is what i see as a benefit or you know a positive all right so let's get to the final part of this topic with climate risk so it's really like is this a good thing or a bad thing but i want you to say is it a good thing or bad thing for insurance not necessarily for the consumer yeah do you think having something

[00:34:14] like this out on the number one portal website for residential real estate which is zillow do you think them putting this out there with first street is a good thing or a bad thing for the insurance industry i say good okay good because more information prompts more conversations more more conversations equal a better understanding of what's included in their homeowners and what's not and so i i say it's a

[00:34:40] good thing because it's more education for the client for the consumer so overall a net positive specifically for insurance do you think the industry gets tighter from something like this so now that there is more information from the consumer from that glass half empty uh mooney perspective do you think the insurance companies are gonna look at this and be like this is just one more reason why we should have

[00:35:10] overanalyzed our risk uh going back to the to the rob shuck episode what's up robby there any uh anytime there's more information the so years ago i tell people years ago when we used to do um auto insurance home insurance uh when i started it was like five rating factors that they okay how old are

[00:35:37] what kind of you what kind of car have you had any accidents you know very basic stuff yeah now there's like thousands of inputs that they're using so the more data that these companies have the more um leverage they have to rate against so anytime there's more information it is going to uh allow these companies to

[00:36:05] use it yeah so it's almost like like we're still in this in this hard market right now where we've had the conversation on past episodes sean's done some incredible ones on insurance really educating our audience about you know things to look out for or what's happening in the industry and insurance for let's say homeowner's insurance because that's what we're relating this to it's almost like the insurance companies

[00:36:30] in this market are looking for reasons not to insure someone yes because the losses have been stacking up for years and they're like we don't want more people who potentially give us more loss yep so like from that perspective i guess it is a good thing because again like if their losses are stacking up i think you would call it before they take rate right is that is that the term yeah and that means

[00:37:00] they're either trying to just take it right from the consumer and say hey your bill went up or they're going to their local what municipality or state is it's it's state driven everything gets filed through the state okay and you need their approval so if you file for a 20 increase the state has to look at your numbers look at your claims claims paid and that sort of thing and then make the determination

[00:37:21] yes this is within the bounds of what's acceptable or they say it's not acceptable your number should be 14 so they kind of ones like dictating what the final number is yep gotcha yeah okay um and then let's talk about it from a real estate standpoint like do i think you know the first street climate risk

[00:37:46] indicator on zillow is a good thing or a bad thing i'm the same as you i think it's a good thing i mean the best way i can put it is i wonder if tucci would agree being the listing agent maybe not you know he's probably gonna get more flack than me yeah i mean i do a little bit of both i'm probably i'm right around like 50 50 60 40 you know 60 listing 40 buyer or 50 listing 50 buyer like somewhere in

[00:38:09] that range year in year out um so i see it from both sides but i think from a buying standpoint this is a good thing because it allows someone to assess like the vulnerability of their asset because like when someone goes to buy a house they come to me and say hey tim you know i want to buy a house in this neighborhood here's my price range beds and baths all this stuff and they have kind of like a

[00:38:35] general understanding of like how much that might cost because they've probably just gone online and done a few mortgage calculators and like okay i get it or if you're really prepared you go get a pre-approval for a property in the neighborhood you want and that pre-approval is really going to dial in what it costs to own this property but when you do those basic steps with someone like me or a loan officer up front you're not really thinking about what happens after i own it you're really

[00:39:02] looking at it's like okay you know in the home yeah if it's like a couple let's say it's you know two people they both work they're like here's the income we bring in and this is what the debt is if we buy the house it's called a debt to income ratio that's a level of risk for mortgage companies to say this is what you can't afford and this is what you can't afford but what no one really calculates is

[00:39:23] what is the cost to own once you own it like okay this is what it costs to own it today but what if my roof got torn off because i'm in a high tornado area or something like that and it's likely that every three years or eight years or 15 years whatever it is people get their roofs torn off or at least damaged around here because we live in one of these heavy tornado areas yeah so i look at this

[00:39:52] as one more opportunity for buyers to assess what is the risk of owning this asset once i have it in my possession so if you were in a more uh let's say you were in california okay and the numbers hold true that 80 percent of people uh really have some consideration for a climate risk uh when evaluating

[00:40:19] the purchase of a home yeah because like of all the stuff that they've been dealing with could it be bad where most of these scores would be on the higher side of bad right and they say oh i don't i don't want that home like what like as a realtor you get in these conversations oh i looked online and zillow had this thing at uh an 89 on the risk scoring right like i i could see in a situation where

[00:40:43] could be a bad thing where the score is negatively negatively impacting a perception right of a home it's almost like you're saying like let's call it a section of southern california across the board has a super high climate risk score yeah and therefore all those properties in that area could potentially be worth less because every consumer is going to see this and be like i'm not going to

[00:41:10] pay that much yeah here's what i'll say to that i think in an area unfortunately like southern california real estate is too expensive to own i think it's too expensive to own for lots of different reasons i mean southern california has amazing weather you know there's probably job opportunities the beach is right there the mountains are right there whatever reason you would move there that's why you want to own real estate but maybe it wasn't you know represented in the price that you paid for the real

[00:41:35] estate that these wildfires are happening pretty regularly now or like you know i'm sure there's some kind of earthquake you know record that people have been looking at for like 30 40 years you know back in like the 80s and stuff like that i kind of remember that that they look at these things but i do think that's a good thing as much as a seller might not like that their home might be worth a little bit less yeah there's also the buying public that let's say someone bought a property

[00:42:03] in the area where the wildfires just happened and no one really explained them what the risk of wildfires were in that area before they bought i guarantee that there's people that bought homes in that area that are losing tons of money because their insurance company is just not going to give them the value that they paid for it and they can't live there anymore like their house is gone yeah so i think it's as much as it would hurt an area like that it's also an area that i would consider being like very

[00:42:33] high on the pricing side so maybe it needs to come down a little bit maybe this is one of the factors that brings it down you can make the same case about new york new york especially manhattan surrounded by water what happens if they have rising waters like you're everything's gone miami yeah miami exactly so i think this is probably going to hurt other places more than others but it doesn't mean

[00:43:00] it's not a good thing for people that are purchasing these assets and also for people when they buy these things now they're more informed when they need to sell it so there's going to be a correction it's kind of the way i look at it um and again the last point i had right here it's just it's kind of like once again this is proving that zillow is kind of like the major player in like real estate data that they continue to be the leader for consumer facing real estate

[00:43:27] websites and again i probably said of agents that do purchase uh leads from in the cold lead generation model in residential real estate that zillow is number one and they're number one for a reason so i wonder what uh you said they're number one um i wonder what um what their revenue breakdown would be like in generating you know ads ads online leads um we'll have to break that down on one

[00:43:54] yeah it'd be interesting to see um you know where they're getting the majority of their money yep all right man why don't you shut us down uh in the beginning of this show we read the uh review from kian on apple um so if you enjoy the show go there leave a review if you want to reach out to us directly you can email us at bricks and risk at gmail.com and then you can follow us as well on socials uh

[00:44:23] instagram facebook youtube and we also have a group uh on linkedin as well where we post out some pretty good information there so look us up yeah all right that's all we have for this one folks thank you for tuning in again to another episode of bricks and risk see you soon thank you for joining us on another episode of bricks and risk our goal is that you walk away with one or two valuable nuggets and we greatly appreciate you sharing your time with us today

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