Two story house under construction

California’s Wildfire Burn, Rebuild Cycle is Breaking

People living in California’s chaparral-covered hills and forested mountains have followed a similar pattern for decades: rebuild after the wildfires.

But more homeowners are choosing to cut their losses and start new, rather than rebuild, according to a New York Times report.

Several factors are combining to squeeze homeowners, starting with a record-setting year of fires. At the close of 2020, nearly 10,000 wildfires scorched more than 4.2 million acres in the state.

Adding to the pinch, historically low-interest rates and a housing shortage have helped push California home prices to record highs. 

According to reports, the median cost of a single-family home in the state crossed $700,000 in August. Home prices are still climbing. 

Additionally, insurers are not renewing policies in areas deemed too high risk for fires. 

In October, the California Department of Insurance reported that home insurance refusals rose by 31% statewide in 2019. In ZIP codes with elevated fire risk, that jumps to 61%, according to reports.

With all of those factors combining, many homeowners find the cost of rebuilding after a fire is even higher.

Strict fire-building codes, which now required sprinkler systems for single-family homes, can increase the costs of rebuilding ab older home by as much as $20,000. 

According to the NY Times, home rebuilds are on the decline across the entire state. 

“Even after the Camp Fire, you’d think we would have seen a spike in the number of permits, and yet we haven’t,” Dan Dunmoyer, CEO of the California Building Industry Association, told the NY Times. “Most big insurance companies will just cut you a big check, and you can be sitting there looking at a check for $900,000. And you talk to contractors, and they say: ‘Sure, I can build you a home, but I’m backed up for a year and a half.’ So we’re seeing a lot people just cut and run.”

In Paradise, the town decimated by the 2018 Camp Fire, the number of rebuild permits stands at just over 10%, according to reports.

There is one exception when it comes to rebuilds. Where the land is valuable, homeowners are choosing to build.

The 2018 Woolsey Fire tore through the beach town of Malibu, scorching 650 multimillion-dollar homes. Today, more than one-third of the households already have rebuild permits. 

Read more about Californians’ willingness to rebuild at