Climate-related disasters are reshaping the U.S. housing market, with new data revealing alarming projections. A 2025 report warns that natural hazards like floods and wildfires could cost mortgage lenders $1.2 billion this year alone, with numbers expected to surge by 2035. Buyers and sellers alike must understand these risks and take proactive steps in every transaction.

The U.S. housing market is grappling with a persistent shortage of homes, and one major reason is the “lock-in effect.” Homeowners with ultra-low mortgage rates secured during the pandemic are reluctant to sell, even as market demand grows. This hesitance is tightening inventory, driving up prices, and reshaping the dynamics of both buying and selling real estate in 2025.