If you’re selling a home in a high-risk wildfire area of California built before 2010, you now face stricter disclosure requirements under new rules that took effect this summer.
The new rule requires sellers to tell buyers not only that the property is in a fire-prone zone, but also features that make the home more susceptible to wildfire and what steps they have taken to make the home more resistant to fire.
This latest action is part of an ongoing effort by regulators and lawmakers to attract more insurers back into California’s homeowner’s insurance market, which has been battered by wildfire losses that pushed many insurers to leave the state, curtail their exposure or impose strict underwriting requirements.
The new rule is part of a 2019 state law designed to encourage retrofits to older housing. It applies to homes built before the state strengthened its wildfire building codes in 2010. Sellers must point out features that could make a home more vulnerable such as:
- Wood-shingle or other combustible roofing
- Vents that are not covered or screened
- Older single-pane windows
- Trees, shrubs or other combustible material within five feet of the structure
If you’ve made improvements (like installing a fire-resistant roof, ember-resistant vents, or clearing vegetation) you must share those details with the buyer.
How the rule may affect the market
Most homes in California were built before 2010, including about 2 million in wildfire-prone regions.
Research on similar climate-related disclosures, such as flood risk, shows that buyers tend to pay more for homes whose owners have made resilience-focused improvements while homes that appear riskier often sell for less.
Insurers are also more likely to consider underwriting a home in a high-risk area if the owners have taken steps to harden it against wildfires.
Future requirements
The new rule is not the end of California’s push for safer homes. Beginning in 2029, all properties in high-risk fire zones will be required to remove combustible material within five feet of structures to create a buffer zone that reduces the chance of embers igniting a house.
Some local communities already enforce similar rules, but the statewide standard will make it mandatory for everyone in these areas.
If you plan to sell a home in a wildfire-prone area, it’s worth considering upgrades now.
Fire-resistant roofs, ember-proof vents and cleared defensible space improve the chances your home could survive a wildfire. These efforts also make your property more attractive to buyers and insurers.