Flood-risk disclosure RCT · Oct 2020–Jan 2021
Treated buyers placed offers on homes with substantially lower flood-risk than controls.
Randomized at the user level across all U.S. metros where Redfin operated (excluding MT, WY, ND, SD). Treatment cohort saw First Street Foundation's Flood Factor scores on listing pages; control did not. Effect measured on the cohort of users whose pre-experiment browsing history concentrated in high-flood-risk listings.
57%
lower flood-risk scores on the homes treated buyers placed offers on,
vs the control group (n = 17.5M).
3-MONTH RCT Oct 2020 – Jan 2021, partnered with USC, NBER, and MIT.
↓ 12.4% in search-behavior flood-risk for the treated cohort by week 9.
Source: Katz, Fairweather & Sandoval-Olascoaga (2022), Redfin News · randomized controlled trial on 17.5M Redfin.com users, Oct 12 2020 – Jan 3 2021 · Flood Factor risk scores from the First Street Foundation, scaled 1 (minimal) to 10 (extreme), representing the probability of flooding over a 30-year mortgage · standard errors clustered at the user level · 95% confidence level · academic version under revision at the American Economic Review (Sandoval-Olascoaga et al., 2024, NBER w33119).
The experiment partnered USC, MIT, and the National Bureau of Economic Research with Redfin to run the first large-scale RCT testing whether property-level climate-risk disclosure changes consumer behavior. Risk scores came from First Street Foundation's Flood Factor model and reflected the probability of flooding over a 30-year mortgage. Engagement concentrated in coastal and southern markets: Cape Coral, Florida (8.5% clickthrough on flood-risk content), Houston (8.1%), and Louisiana statewide (7.5%) led the country. The published version of this work, now under revision at the American Economic Review, extends the analysis with a longer panel and additional outcomes including transacted prices (Sandoval-Olascoaga et al., 2024).
Climate-risk data may start to have an even bigger impact on homebuyer decisions now that the housing market is slowing and tilting more in buyers' favor. Sandoval-Olascoaga, in the Redfin piece.Read the full piece at redfin.com → Includes the metro-level engagement table and additional Redfin agent context from Jacksonville.