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Sixteen-year-old Swedish climate change activist Greta Thunberg arrived in New York Wednesday after setting sail on an emissions-free yacht for a 15-day journey across the Atlantic. At the same time, the Trump administration announced this morning its move to roll back regulation on methane emissions, which would weaken restrictions on oil and gas companies regarding monitoring and repairing leaks.

The push-and-pull efforts in a battle for sustainability put climate change at the forefront of discussions among people, industries and governments across the globe — and the housing market is no different.

The mortgage market is experiencing effects of the war on climate change as discussions dictate trends from where consumers want to buy to the type of financing they're using. With that in mind, here's a look at some ways climate change is affecting the housing market.
Climate change
Consumers reluctant to buy in certain cities
The majority of young adults and consumers in coastal housing markets believe climate change will directly affect their homes or communities, influencing where they consider making purchases, according to Zillow. Natural disaster risks in certain cities highlight some as more or less desirable for homebuyers.

Consumers in Miami, San Jose, Calif., and Los Angeles are among those most likely to anticipate being personally affected by climate change, while those in St. Louis, Detroit and Philadelphia are among the least likely.

Millennials are the most conscious of climate change among all generations. And because they comprise the largest cohort of potential homebuyers, it allows them to dictate purchase demand shifts to and from certain areas.
Solar panels
Homebuilding goes green
New techniques in homebuilding are paving the way for more sustainable construction. Builders are looking at ways to conserve resources by using high-engineered wood, wood alternatives and recycled materials, according to the National Association of Home Builders. They're also stocking homes with features like water-efficient appliances and filtration systems and low-maintenance landscaping. Homebuyers are also seeking out some of these offerings when considering a home purchase.

One-third of homebuilders said green building was a significant share of their overall activity, with the number expected to climb to at least half by 2022, according to NAHB. National energy codes are also developed and published on a three-year cycle to help foster cost and energy efficiency, according to the organization.
Dollars in hand
PACE loans come into play
With climate change nurturing a green building environment, other types of financing gain popularity. Commercial developers, for example, are increasingly tapping Property Assessed Clean Energy loans for funding, which have helped support costs for stricter environmental building codes that have emerged.

PACE loans helped finance $660 million in sustainable improvements between 2016 and 2018, compared to only $208 million over the prior six years, according to nonprofit PACENation. The PACE model can also help homeowners pay for energy modifications like solar paneling.
Zillow
Rising sea levels create more risk
Rising sea levels are putting homeowners and builders at risk in coastal markets.

In the next 30 years, an estimated 802,555 homes worth $450 billion reside under the risk of flooding, according to a joint study by Zillow and Climate Central. Pollution levels from greenhouse gas build-up could cause chronic ocean flooding by 2050 and subsequent mortgage distress.

Such threats continue to spark an ongoing debate over the renewal of the National Flood Insurance Program. Last month, lawmakers from states threatened by storms unveiled a bill to reform NFIP, which they say is better for consumers than recent legislation passed by the House Financial Services Committee — but most felt it would increase costs. Contrarily, the House bill by Chairwoman Maxine Waters, D-Calif., which includes an update maps to create new flood zones, drew bipartisan praise during the committee debate.
Paperless
Industry reducing carbon footprint
The climate change conversation has prompted mortgage companies and others in the broader finance sphere to consider ways to reduce their carbon footprint. Bank of America cut paper usage by 32% in a five-year period, and recycles 30,000 tons of paper annually. The digital mortgage era is helping fuel these efforts, while also cutting costs for the industry.

In another example, Citibank vows to be powered solely via renewable energy by next year, and is investing $100 billion in a 10-year commitment toward sustainable growth.
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