Understandings of climate finance are in flux today in politically urgent ways, posing timely questions for critical urban scholarship and practice. The term climate finance came prominently into use as a point of contention in United Nations Conference of Parties (COP) debates over the last decade. It was employed in calls upon wealthy countries to dedicate funding to support climate change responses in the Global South—recognizing that many countries who have contributed least to the climate crisis now stand to suffer most from its impacts. Climate finance is also a growing priority for multilateral and bilateral development funders. However, governmental and multilateral channels of climate finance have persistently failed to meet pledged and called-for commitments, let alone address the more significant climate financing gap facing communities worldwide, or the even higher tally suggested by more transformative understandings of climate/ecological debt and reparations. Growing critical scholarship suggests that a major outcome of—and underlying factor in—this political impasse has been an increase in the power of private financial institutions to set the terms of new climate-related investment, and to define narratives of (and capacity for) financing responses in their favor. [...]@en

Home insurance markets in the United States are experiencing a mounting crisis. Worsening climate disasters like more intense hurricanes, wildfires, and hailstorms are making multi-billion-dollar payouts an annual occurrence, hitting a broad range of US states. Insurance protections are shrinking and becoming increasingly unaffordable, while private insurers are raising rates or pulling out of some markets entirely. Homeowners left behind face dilemmas like potential mortgage defaults—personal risks which may spiral into broader property market collapses. Meanwhile, renters and other households confront future uncertainties with even more limited protections. How can we more fully understand this mounting housing crisis, and what is to be done about it?@en

As intensifying climate-related disasters strike cities across the United States, they are provoking rising concern for the stability of the U.S. housing market and broader financial system. How homeowners, mortgage lenders, federal institutions/regulators, and investors will variously encounter and manage climate risk is an urgent question for urban scholars, as is who might bear the costs of restabilizing mortgage finance under new breakdowns. This paper’s multi-scalar intervention draws on financial “following” methods to explore how climate risks are being experienced and governed at multiple illustrative moments of U.S. mortgage finance: (1) working households at the front line of urban climate impacts, (2) mortgage professionals brokering loans to them, (3) government-sponsored enterprises (GSEs) negotiating incoming federal climate risk disclosure requirements, and (4) capital markets off-taking GSE risks through financial derivatives like credit risk transfers. Emerging concerns include ruptures between household risks and financial system-preserving responses and new dangers of “climate redlining.”.

@en