Are Some Homebuyers Strategically Transferring Climate Risks to Lenders?

Abstract: Recent empirical research suggests that certain homebuyers may be strategically transferring climate risks to banks via the mortgage market, and banks may be transferring such risks to government-sponsored enterprises via securitization. The evidence highlights the nuanced ways in which participants in the financial markets strategically adapt to climate change.

Keywords: mortgage; climate change; lenders; risk;

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Bibliographic Information

Provider: Federal Reserve Bank of Richmond

Part of Series: Richmond Fed Economic Brief

Publication Date: 2022-04

Volume: 22

Issue: 14