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Wildfire risk threatens nearly $1.4T in reconstruction value across the West

Cotality says neighborhood-to-neighborhood fire spread, conflagration, can add up to 40 points to a property risk score and move hazard into areas previously rated low risk.

Reported · Written up by our desk · Residential

HousingWire reports that Cotality’s 2026 Wildfire Risk Report estimates more than 2.5 million properties across the 10 most exposed western states face moderate or greater wildfire damage risk, totaling nearly $1.4 trillion in reconstruction cost value.

The report attributes rising loss concerns not only to wildfires but also to conflagration, where fires spread from home to home within neighborhoods. Cotality says traditional models can miss this pattern, understating risk in some areas, and that layering conflagration potential can add up to 40 points to an individual property’s risk score.

California remains the most exposed state in the analysis, with 1.28 million at-risk properties and $850 billion in reconstruction cost value. However, Cotality estimates 49.9% of at-risk properties across the top 10 states are outside California, with Colorado and Texas together accounting for nearly 560,000 at-risk properties and $252 billion in reconstruction cost value.

At the metro level, Los Angeles has the highest exposure, at nearly 250,000 at-risk properties and $209 billion in reconstruction cost value. Cotality also highlights that four of the 10 most exposed metros are outside California, led by Austin with more than 100,000 at-risk properties and $49.2 billion in reconstruction cost value.

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