Whether or not you live in California, you're probably aware that the state is susceptible to wildfires. In recent years, however, the fires in California have become bigger and more frequent and are more difficult to put out. How do you as an investor know whether it's safe to invest in a place that could burst into flames? Studying the Fire Hazard Severity Zone map helps.
What is a Fire Hazard Severity Zone?
A Fire Hazard Severity Zone, or FHSZ for short, is a mapped area developed by the California government -- the California Department of Forestry and Fire Protection (CAL FIRE) -- which shows the areas most likely to experience devastating wildfires. These areas are delineated by a zone system, and each zone has a designation of the likelihood of fire hazard: moderate, high, and very high.
FHSZs are located only in state responsibility areas, which cover over 31 million acres in California. Locales in California that don't fall under a state responsibility area are governed by local or federal agencies.
What FHSZs can do to improve a fire hazard area
Once city planners know which areas are most susceptible to devastating wildfires, they can implement policies through planning that could mitigate damages and therefore risk to the investor. This is being done, for example, through a requirement of homes in FHSZs with the greatest danger of wildfires to meet Chapter 7A of the California Building Code.
Building codes for fire safety typically require buildings to be constructed to better withstand burning embers. Codes can apply to roofs, attics, siding, exterior doors, overhangs, and windows. The intended result is for the building to withstand a fire rather than burning to the ground. Regarding Chapter 7A specifically, the building codes have been proven to work. In Paradise, California, for example, where 86 people died in the 2018 Camp Fire, of the 350 homes built under Chapter 7A, 51% of homes survived, compared with only 18% of homes built before the building code was in place.
What FHSZs can and cannot do for investors
Before investing in California, you can study a FHSZ map to determine whether the area you're considering is an area of concern regarding wildfires and their severity. The maps show likely hazard zones, but they don't measure risk.
The significance is that a hazard area is one with the necessary conditions that make the area likely to burn -- in this case, spanning a 30-to-50-year period. A risk, which the FHSZ maps don't calculate, lets people know the potential damage a fire would cause, given the existing conditions. This includes methods taken to minimize risk.
About California wildfires
Not only are forest fires happening more often in California, in recent years, more people are living and opening businesses near affected areas, called the ''wildland-urban interface.''
There are reasons people are living in these areas: Some want to live in wine country, and that usually means living in a canyon or a hillside near unbuildable land, a likely spot for a wildfire. Other people move near wilderness areas because the big cities of San Francisco and Los Angeles have become largely unaffordable. CAL FIRE responded and now requires defensible space of 100 feet between wildlands and residential areas.
The Millionacres bottom line
No one has a crystal ball that will tell you when or whether a wildfire will happen. But that's OK. Investors become successful when making decisions based on likelihoods and probabilities, not necessarily sure things. The FHSZ map is one tool for you to use before investing in a fire-prone area of California.