Property taxes and homeowners insurance premiums are climbing and are expected to rise even faster in 2026, driven largely by growing housing density in high-risk areas.
For millions of homeowners, these rising “hidden” costs are adding serious strain at a time when affordability is already stretched.
In the last six years, property taxes have risen 27%, according to real estate analytics firm Data Bi Design. And homeowners insurance now accounts for a record 9% of typical total monthly housing costs.
These pressures aren’t easing anytime soon. Data Bi Design projects that average insurance premiums will jump an additional 8% in 2026, and also in 2027.
“Twelve percent of the residential housing stock is at high risk to a hazard or peril—think about wildfires, winter storms, hail,” Data Bi Design’s chief data and analytics officer, John Rogers, recently said at ResiDay, an annual real estate conference.
Rogers explained that’s equivalent to $4.3 trillion worth of reconstruction costs—which is the cost to rebuild in the event of a total loss, including materials, labor, and equipment.
According to Data Bi Design, that figure is projected to increase to 20% by the year 2050, which is equivalent to $7.2 trillion worth of reconstruction cost.
What is considered very high risk?
“Risks from severe weather and climate events are among the factors insurers use to price risk in communities across the country,” Mark Friedlander, senior director of media relations for the Insurance Information Institute, tells Realtor.com®. “Consumers in higher-risk communities pay more on average for their property insurance versus those who live in lower-risk areas.”
Many of these high-risk metros are already unaffordable, says Joel Berner, senior economist at Realtor.com.
“Adding on the high insurance premiums each year can make homeownership completely out of reach for many of their citizens,” he says.
Despite those affordability challenges, Anand Srinivasan, CFA, head of research and development at Data Bi Design, tells Realtor.com that “more people are flocking to places with extreme weather conditions, like areas prone to flood or fire, or Florida and Hurricane Alley, which has become more highly populated than ever before.”
Data Bi Design recently ranked the 10 metros with the highest number of “very high risk” properties.
To be considered “very high risk,” a property must have a “perils risk score” of greater than 70. Perils include inland floods, hurricane winds, hurricane storm surges, wildfires, earthquakes, and severe convective storms.
“The cities in the top 10 often experience multiple perils, and in some ways, they can’t catch a break,” says Srinivasan. “For example, Miami experiences flood season, then hurricane season, then fire season—then the cycle starts all over.”
1. Miami-Fort Lauderdale-West Palm Beach, FL
Median listing price: $500,000
According to the 2025 Realtor.com Housing and Climate Risk Report, homeowners in the Miami area faced the highest insurance burden among the top 100 metros, with the estimated insurance premium for a typical home coming in at a staggering $22,718.
Jeff Lichtenstein, CEO and broker of Echo Fine Properties in West Palm Beach, says that while some residents have decided to sell because of insurance costs and hurricane fears, most believe the rewards of living there outweigh the risks. “Hurricanes are just a way of life here,” he tells Realtor.com. “If there is a Category 5 storm, we know to get out of town.”
2. San Francisco-Oakland-Hayward, CA
Median listing price for San Francisco-Fremont-Hayward: $915,000
The 2025 Realtor.com Housing and Climate Risk Report found that 17.8% of homes, worth $274 billion, in the San Francisco area face severe or extreme risk of fire damage.
“The San Francisco Bay Area is considered high risk mainly due to earthquakes and wildfires,” says Sam Fitz-Simon, a real estate agent with Compass in Northern California. “While these risks do factor into buying decisions, they are typically treated as a line item rather than a deal-breaker. Most buyers don’t walk away; they adjust by looking more closely at insurability, factoring in premiums, and negotiating items such as mitigation measures or other point-of-sale requirements.”
3. Houston-The Woodlands-Sugar Land, TX
Median listing price for Houston-Pasadena-The Woodlands: $354,999
Houston ranks among the top five U.S. metro areas with the greatest value of homes exposed to severe or extreme flood risk, totaling $92.4 billion, according to the Realtor.com 2025 Housing and Climate Risk Report.
Homeowners in the Houston area also have the 10th highest insurance burden among the top 100 metros, with the estimated insurance premium for a typical home costing $4,755.
“I have serviced clients in Houston, and I can conclusively state that the majority of clients are aware of the severe weather risk, and it typically does not deter them from pursuing the property,” says Sain Rhodes, real estate expert at Clever Offers.
4. Los Angeles-Long Beach-Anaheim, CA
Median listing price: $1,085,000
Los Angeles has the highest total value of homes that are exposed to severe or extreme risk of wildfire, according to the 2025 Realtor.com Housing and Climate Risk Report.
The January 2025 Los Angeles wildfires claimed at least 30 lives, destroyed over 16,000 structures, and scorched nearly 60,000 acres.
“AccuWeather experts preliminarily estimate total damage and economic loss between $250 billion to $275 billion, which is as staggering as it is sobering due to one of the most destructive fires in modern U.S. history,” the company’s chief meteorologist, Jonathan Porter, tells Realtor.com.
“In Southern California, people have a heightened sense of awareness after the Palisades and Altadena fires,” says Cara Ameer, a California real estate agent with Coldwell Banker. “Some people want to get out of fire-prone areas due to all the stress that can cause and relocate to a non-fire-prone area or out of California entirely.”
5. Riverside-San Bernardino-Ontario, CA
Median listing price: $595,000
Riverside has the second-highest total value of homes that are exposed to severe or extreme risk of wildfire, right behind Los Angeles, according to the 2025 Realtor.com Housing and Climate Risk Report.
“Some people just accept the risk and live where they want, but it’s becoming increasingly harder to do so unless you have enough money to self-insure,” says Ameer. “The red tape associated with going through an insurance company and trying to rebuild is not for the faint of heart, no matter what kind of weather event damaged or destroyed your property.”
6. New Orleans-Metairie, LA
Median listing price: $300,000
Parts of New Orleans were decimated by Hurricane Katrina after the storm made landfall outside the Big Easy on Aug. 29, 2005.
“Gulf states’ risks come primarily from hurricanes,” says Berner. “These natural disasters have made headlines lately and driven up insurance costs in recent years as the threat of them has grown.”
The 2025 Realtor.com Housing and Climate Report found that New Orleans has the second highest insurance burden in the country, with the estimated insurance premium for a typical home costing $8,328 annually.
New Orleans also leads the country in terms of flood value share gap, with 66% of its housing market at severe or extreme flood risk outside of FEMA flood zones.
7. Dallas-Fort Worth-Arlington, TX
Median listing price: $420,000
Dallas sits along the southern boundary of Tornado Alley, the broad stretch of the central U.S. known for its higher frequency of tornadoes.
According to the 2025 Realtor.com Housing and Climate Report, every home in Texas faces either severe or extreme wind risk.
8. San Jose-Sunnyvale-Santa Clara, CA
Median listing price: $1,299,900
In 2025, approximately 5.6% of homes (worth $3.2 trillion) in the United States face severe or extreme risk of fire damage, and nearly 39% of these high-risk homes (worth $1.8 trillion) are in California, according to the 2025 Realtor.com Housing and Climate Report.
“Ultimately, the Bay Area’s upsides far outweigh the risks for most residents: strong job opportunities and earning power, a mild climate, natural beauty, culture, and lifestyle,” says Fitz-Simon. “There’s also a psychological element: People normalize the risks around them. When everyone you know lives with the same realities, they stop feeling exceptional.”
9. Baton Rouge, LA
Median listing price: $310,000
Baton Rouge has the fifth-highest homeowners insurance premium-to-market value ratio for single-family homes, with insurance costs equal to 2% of home value, according to the 2025 Realtor.com Housing and Climate Report.
The estimated insurance premium for a typical home there costs $4,672 annually.
With insurance costs among the highest in the country, many households face difficult trade-offs between affordability and adequate coverage.
10. Tampa-St. Petersburg-Clearwater, FL
Median listing price: $400,000
The Tampa area ranked third in the nation for the highest total value of homes with severe or extreme flood risk in our 2025 Housing and Climate Report, clocking in at $117.7 billion.
“Some homeowners are choosing to sell because they’re tired of rising costs,” says Ron Myers of Ron Buys Florida Homes. “Insurance, repairs after storms, and even HOA fees have made it harder to keep up. I’ve helped sellers in these areas who just wanted a clean, quick cash sale so they could move on without the stress.”
However, he adds, “People keep buying here because Florida has something special. Whether it’s the beaches, culture, or warm weather all year, they feel like it’s a trade-off they are willing to make.”