First Street Under Fire: Are Climate Risk Scores ‘Deceptive’?

In September 2024, Zillow — the US’s largest online real estate marketplace — announced it would introduce climate risk scores for homes listed on its platform, offering buyers insights into flood, wildfire, wind, heat, and air quality hazards at the property level. The data would come from First Street Technology, a climate risk analytics start-up that had just raised some US$22mn from venture investors.

Around four years earlier, First Street Foundation — the company’s non-profit predecessor organization — had closed similar deals with real estate platforms Redfin and Realtor.com. The aim of the scores, as First Street CEO and founder Matthew Eby explained in Zillow’s press release, was to enable “millions of everyday users… [to access] the same property-specific climate risk data that is used by top banks, agencies and investors.”

But these scores have now put First Street in the crosshairs of not one, but two states accusing the company of deceiving would-be homebuyers and gumming up the residential real estate market. On August 27, Nebraska Attorney General Mike Hilgers filed a 63-page lawsuit against First Street, claiming the public risk scores add “an unexpected and unsolicited burden” on Nebraskan homeowners trying to sell their properties. Florida Attorney General James Uthmeier followed on October 23 with a 45-page complaint in Polk County, much of it copied word for word from Nebraska’s.

Both AGs want First Street to stop issuing the risk scores, have the company pay fines, and repay those they claim have been harmed by its conduct. They are also demanding a jury trial. “Florida homeowners deserve facts, not alarmist scores,” Uthmeier said in a video announcing the suit.

Experts say the two states’ cases rest on shaky foundations. “The lawsuit appears to be more about political posturing during election season than protecting consumers,” says Joel Scata, senior attorney at the Natural Resources Defense Council.