In the coming decades, climate change will likely force up to 50 million Americans to leave their homes along the U.S. coasts and in other climate-vulnerable parts of the country. Some will be suddenly and violently displaced as a result of natural disasters. Others will relocate due to the creep of increasingly unlivable conditions, as both droughts and floods become more frequent and triple-digit heat becomes more pervasive

Looking ahead, some of the safest parts of the U.S. for these climate migrants will be northern cities like Duluth, Minnesota, and Rochester, New York. These “climate havens” are relatively sheltered from natural hazards and have the capacity to welcome new residents. Yet recent trends show that Americans displaced by climate are not moving north. They are instead choosing to stay in place and rebuild, despite the continued physical and financial risk. Or they are moving to nearby neighborhoods and towns just as vulnerable to climate change. In fact, millions of Americans are actively moving to the most vulnerable parts of the country, largely in the Sun Belt. Most of America’s fastest growing cities are located in Texas, Arizona and Florida.

For now, storm-wracked Houston, sizzling Phoenix and flood-prone Miami are getting by, albeit under the strain of rising housing costs, bloated property insurance bills and buckling infrastructure. But population growth – or frankly, even the lack of population outflows – in increasingly climate-vulnerable communities is a ticking time-bomb. Rising waters, sprawling wildfires and deadly storms will lead to hundreds of billions of dollars annually (!) in financial losses from property damage.

The real estate, mortgage lending and homeowners insurance markets may eventually collapse in hard-hit regions. The result could then be a downward socioeconomic spiral and ultimately a chaotic and costly mass exodus inland and northward, with many poor and otherwise marginalized households left behind.

So why aren’t Americans relocating to the parts of the U.S. that science tells us will best protect them from the elements? Research confirms what most of us already suspect: people choose where to live based on a whole mix of social, economic and emotional factors. Borrowing approaches from psychology and behavioral economics, we propose strategies that may be more effective in coaxing migrants to climate havens than tired warnings that the sky is falling.

Read it and Weep

But falling it is. The U.S. experienced 28 disasters with billion-dollar-plus costs in 2023, the most ever in a single year. All told, damages (narrowly defined) across the country totaled nearly $93 billion, while an estimated 2.5 million people were displaced by storms, floods, fires and other natural hazards. It’s been more of the same in 2024: Hurricane Beryl knocked out power in Houston during a brutally hot summer, wildfires have burned for months out West, Hurricane Helene inundated Asheville, North Carolina, and just weeks later Hurricane Milton savaged Sarasota.

Some polling and anecdotal reporting indicate that a growing number of Americans are beginning to grapple with climate risk and relocation. In a 2021 Redfin survey, nearly half of the respondents who planned to move in the next year cited extreme heat and increasingly frequent and severe disasters as a factor in relocating. More than a third mentioned sea-level rise.

But we should watch what people do, not what they say. Post-disaster analysis shows that displaced Americans typically remain close to home. Following the devastating 2018 Camp Fire, for example, 80 percent of survivors remained in California. Post-Katrina, over half of displaced New Orleans residents settled elsewhere in Louisiana or in nearby Texas. That syncs with the broad conclusions of research released by the Natural Resources Defense Council, which found that many people displaced by disasters prefer to remain in their own regions.

This trend holds for voluntary home buyout programs, which have relocated nearly 50,000 households over the past 40 years. A 2023 Rice University report on government purchases of flood-prone houses found that 58 percent of participating owners relocated within a 10-mile drive of their old residences, while nearly three-quarters remained inside a 20-mile radius. As the Rice researchers put it, “most retreating homeowners are not moving long distances to safer towns, states and regions; they are churning in and between nearby neighborhoods.”

In our own 2023 report for New America, we concluded that this reluctance to move any farther follows from the reality that climate change is only one of many factors that Americans bring into their relocation decisions, alongside access to jobs, housing prices, social networks and place attachment. So a preference for short-distance moves is unsurprising, as many people will choose to relocate where they have roots and where things are familiar. Across the Sun Belt, however, that means that millions of U.S. climate migrants could linger in communities that are only marginally less climate-vulnerable than the ones they’ve just left.

Why the Sun Belt?

While increasingly vulnerable to climate risks, the Sun Belt accounted for 80 percent of total U.S. demographic growth in the past decade. Eleven of the 15 fastest-growing large cities in the country are located in Texas, Florida and Arizona, states variously at risk of sea-level rise, extreme heat, drought, flooding and hurricanes. The Sun Belt now holds about 50 percent of the national population, and that share is expected to rise to 55 percent by 2040.

So what’s pulling people to the very places where climate impacts are crashing? Ed Glaeser and Kristina Tobio observe that the population boom in the region between 1950 and 1980 was primarily driven by jobs, with housing supply increasingly important in the following decades. Housing construction in the South outpaced the rest of the U.S. by at least 20 percent during the 1970s and 1980s, and that trend has shown no signs of reversal. Texas and Florida led the country in new units in 2023. Subsidized insurance and (until recently) minimally invasive housing codes have helped to keep costs low for individual homeowners.

It’s also likely that economic policies – notably low taxes and business-friendly regulation – are also contributing to the Sun Belt’s population growth. Historically, labor unions were less entrenched in the Sun Belt, which made the region attractive to foreign automakers and other manufacturing firms in the 1980s and 1990s. Tech giants like Tesla, Apple, Samsung and Hewlett-Packard have expanded into the South in recent years, too, in large part due to lower operating costs.

Tax credits, grants and loans included in recent federal legislation are further incentivizing massive investments across the Sun Belt. Over $60 billion, for example, has recently poured into Phoenix to subsidize advanced computer chip manufacturing, and companies including Intel and the Taiwan Semiconductor Manufacturing Company are building huge factories in the area. All told, Biden-era policies to boost the growth of “21st century industries” like semiconductors, renewable energy and electric vehicles are resulting in twice as much investment in the South as in the Midwest, the country’s traditional industrial center.

Aside from economic growth and housing affordability, there’s the balmy weather. Arizonans may not consider the ability to fry eggs on their car hoods in August (and May, June, July and September) to be an asset. But a survey conducted in 2008 by Pew Research Center found that nearly two-thirds of Americans prefer to live in warmer climes, with Sun Belt cities including San Diego, Tampa and Orlando ranked at the top of desirable hometowns.

Frogs in a Pot

One reason to stay is obvious: plenty of lower income Americans simply lack the financial resources to move in response to climate change. But the social sciences can help to explain why so many other Americans who could leave choose to remain in place, even as flood, wind and fire grow more frequent and severe.

To start, there’s the concept of present bias, or the idea that people tend to focus on what’s in front of them, discounting future gains or drawbacks. Costs that add up over time, such as repeated property damage or a decrease in home value, aren’t top of mind.

Then there’s optimism bias, or the reality that people generally think they’re less likely than others to be harmed by adverse events. Put differently, many Americans are likely overconfident that their houses are sturdy enough to withstand hurricane-force winds or that their vulnerable neighborhoods won’t flood. For others, optimism bias means a belief in themselves and in their community to bounce back post-disaster, implying that the cost of the disaster is lower than others might predict.

It’s worth noting that information asymmetries and outdated risk analysis also feed into these dynamics. For example, according to researchers writing in the journal Nature Climate Change in 2023, residential properties across the U.S. are overvalued by $121 billion to $237 billion due to underestimated flood risk alone. Meanwhile, the First Street Foundation estimates that, overall, 39 million American residential properties are at high risk of flooding, hurricanes and wildfires, which is yet to be reflected in insurance costs. Roughly one-third of U.S. states don’t have disclosure laws on the books, which would require sellers to inform buyers that a house is at risk of flooding or has previously flooded. It’s clear that many homeowners do not grasp the growing danger to their properties.

Finally, behavioral economics and psychology hint that people enjoy intangible benefits from remaining in place, and these benefits arguably offset some of the climate risk. Individuals often perceive the potential loss of leaving a tight-knit community or a long-time home more strongly than the potential gains of moving to a vaguely safer locale. In part, that’s because of what economists call the “endowment effect” by which people tend to place higher value on something they already own. And exacerbating all this is that humans are inclined to confuse sunk cost with current value, leaving them unwilling to walk away from the time, money and effort they’ve already spent, even if the product is lost.

Add everything up, and it’s unsurprising that Americans throughout the Sun Belt opt to rebuild post-disaster and to shrug off worsening climate impacts. It goes a long way to explaining why people stick to places like Galveston and New Orleans, which are one bad storm away from catastrophe.

How Do We Move People Out of the Sun Belt?

There’s a glimmer of evidence – the aforementioned Redfin survey – that some Americans are beginning to account for climate risk in choosing where to move. Analysis from First Street Foundation suggests that 3 million people have already relocated due to climate-related flooding and flood risk. And a recent working paper from the Federal Reserve Bank of San Francisco by Sylvain Leduc and Daniel Wilson maintains that net migration to the Sun Belt is slowing, perhaps in part because of climate change.

But the change is not nearly enough to reverse a five-decade population boom in the Sun Belt. Accordingly, external incentives are needed: the U.S. must make relocation to more climate-resilient communities both less painful in the short term and increasingly logical and attractive in the long term. That means adopting a range of public policies that nudge people away from at-risk locations, while also creating more socially and economically appealing receiving communities. And we believe that social science can help on that score.

Lesson From the Insurance Industry

Insurers have long used strategies tied to behavioral economics and psychology to convince people to bear the financial cost of premiums in exchange for the vague longterm benefit of security from unlikely events. The GEICO Gecko and Jake from State Farm aren’t the only tools in the industry’s pockets. Insurers rely on human biases that prioritize security and that overvalue the likelihood and impact of future calamities.

For example, insurers take advantage of risk aversion – unwillingness to bear risk even when it is a good bet – by transferring risk from the individual to the insurer for a price. Similarly, insurance overcomes “regret aversion,” a cognitive bias in which a decision maker often chooses the option that will carry the least potential regret, even if shedding that potential is very expensive. Indeed, the fear of regretting not having insurance in the unlikely event of catastrophe is a major source of motivation. Insurers also play into the cognitive biases of loss aversion and endowment effect, in which customers overestimate the pain of a potential loss – such as a car accident or a medical emergency – and overvalue what they currently own, respectively.

Insurers overcome overconfidence bias, which prompts potential customers to believe that bad things won’t happen to them, by deploying the availability heuristic, which posits that people tend to overestimate the probability of events that are easily recalled or frequently discussed. A major function of insurance commercials that vividly depict auto accidents, natural disasters and illnesses is to trigger this heuristic. To counter the forces of present bias, insurers often offer short-term rewards – for example, discounts for signing up early or bundling multiple-risk policies.

And finally, insurers rely on herd behavior to convince more customers to sign up for policies. They air the testimonials in which customers highlight how insurance protected them in difficult situations. Once enough people within a friend group or community have purchased insurance, the remainder typically follow.

From this starting point, we can use behavioral economics and psychology to construct climate migration policies that make it rational for populations to relocate.

Making it Irrational to Stay Put

To incentivize climate-vulnerable populations to move to more resilient parts of the country, we should start with the assumption that people are rational – that they make decisions they believe are in their interest. A successful climate relocation strategy must therefore be based on programs that make it seem irrational to stay in climate-vulnerable regions and make it rational to move to more resilient places.

Loss aversion and risk aversion, for instance, are powerful principles to incentivize movement away from risky regions. As mentioned above, the problem is that homeowners are often unaware of the risks of catastrophic loss because many states lack flood disclosure laws. But efforts are underway to close this gap: since 2018, 10 states have enacted or improved disclosure laws. One approach to accelerate the process would be to create federal flood disclosure requirements.

However, even if homebuyers are aware of risks, they might not care if the consequences of ignoring risk are actually modest. FEMA offers heavily subsidized insurance to all residents in floodplains through the National Flood Insurance Program. And despite recent efforts to bring premiums in line with true risk, the insurance remains too cheap to be self-sustaining. That’s the very definition of what economists label a “moral hazard.” The fix is raising rates or denying insurance in the most dangerous zones.

The politics, though, are, to say the least, problematic. FEMA has recommended dropping any properties that have been repaired four or more times from its flood coverage. But even this modest proposal has been slow to gain congressional support.

Actually, the incentives to stay in harm’s way are even more perverse than you might imagine. A home that is damaged or destroyed by a storm is eligible for federal recovery funds, regardless of whether it was covered by flood insurance or if it makes sense to rebuild in the teeth of ongoing risk. It thus seems a no-brainer to cap the number of times Uncle Sam underwrites the Sisyphean task of rebuilding houses blown over or submerged. Funding should instead prioritize buyouts and proactive relocation with an eye toward covering the full costs of a move, including the myriad ancillary expenses inherent in changing addresses.

Loss aversion also provides a powerful communication technique, as we know that people respond more forcefully to the prospect of a loss than the prospect of a symmetric gain. Home buyout programs and other relocation efforts should frame moving as the potential to avoid catastrophic economic loss rather than as a chance for a better life. Telling victims that “if you stay, you risk losing 40 percent of your home’s value” will be more effective than framing the benefits of moving – as in “you could gain 20 percent in home equity by moving.”

Status quo bias and the related concept of default options hint at another underutilized relocation strategy. Behavioral economics shows that people tend to stick with their current option. In response, the U.S. could design relocation or buyout programs so that moving is the path of least resistance, for example, making programs “opt out” rather than “opt in.”

Moreover, local governments should use their broad authority to regulate land use to gradually phase out residences in vulnerable areas. Life estates allow people to stay in their homes for the remainder of their lives, but mandate that the house revert to government control thereafter. Rolling easements, which push the limits on construction further inland as sea levels rise, could be used to halt new development while also providing notice to nearby residents that the bell would eventually toll for them, too.

In developing these strategies, the government must overcome people’s focus on immediate gains – that is, present bias. This is an uphill battle, as the short-term rewards of staying in a beloved home are obvious, while moving costs, both pecuniary and emotional, are significant and the long-term benefits of relocation are hazy.

This present bias is augmented by the endowment effect, as many people tend to over-value their possessions. To try to overcome this, decision makers can offer immediate financial incentives such as cash grants, tax breaks or housing subsidies to those who relocate. Compensation that exceeds the current market value for primary residences in climate-vulnerable areas would help to reduce attachment and overcome the psychological hurdle of leaving. So would packaging relocation programs with perks like fast-track access to public services, subsidized utility costs, job training or guaranteed employment.

This approach could reframe retreat from climate risk as an investment rather than a sacrifice. By the same token, using scarcity and urgency as framing to make these incentives time-limited could spur Americans to take advantage of them.

And finally, we can expect that once enough people leave, herd behavior will take effect. People’s decisions are heavily influenced by the behavior of those around them, and watching a steady exodus of their neighbors will persuade them to follow suit. Publicly highlighting the stories of climate migrants who have benefitted from moving could also help to create a social norm around relocation.

Offers They Cannot Refuse

Second, we need to make sure that geographically resilient parts of the U.S. are economically and socially appealing in the long term. Many Americans will need a push to exit flood- or fire-prone localities. Yet where they go next is also critical for household and community resilience. To ensure that people relocate to safer ground, climate havens need to actively position themselves as the easy choice. In large part, that means holding up their end of the bargain when it comes to relocation incentives such as good jobs, affordable homes and accessible services like transportation, education and health care.

Rust Belt cities like Duluth and Detroit, which have experienced decades of deindustrialization, must work (presumably with state and federal help) to provide greater opportunities for businesses and workers. That could include more favorable tax regimes that are competitive with business-friendly Sun Belt markets. Policymakers could also incentivize investment through public-private partnerships with key industries, work to pre-certify commercial sites and fast-track construction of critical infrastructure, and create training programs for prospective employees.

A good example of how this might work is tech giant Micron’s 2022 decision to build a factory in upstate New York. The company is leveraging $5.5 billion in incentives from the state, tax credits from the federal CHIPS and Science Act and city- and county-level infrastructure support to build a semiconductor facility in Onondaga County. The plant is expected to create 50,000 jobs, potentially drawing tens of thousands of people to a climate-safer region.

Many people will move for jobs, but they’ll also need affordable housing. And the ill-planned, rapid arrival of climate migrants in a receiving community could overwhelm a local housing sector. Experience from California is emblematic: following the 2018 Camp Fire in the Sierra Nevada foothills, thousands of people displaced by the flames headed for nearby Chico, causing rents to skyrocket and fueling a homelessness crisis.

It’s plain, then, that adequate housing will be foundational for any successful revitalization of the Midwest and Northeast as climate havens. Building – or, in the case of many receiving cities, restoring – housing and infrastructure takes time, and so potential receiving cities need to start preparing for climate inflows well in advance. Local policymakers possess many of the tools to meet this need: they can leverage their land use and zoning powers to allow for infill housing development, accessory dwelling units on single- family plots, and the retrofitting of old and abandoned infrastructure into residential or mixed-use buildings.

Through more relaxed zoning policies, or upzoning, receiving cities can also encourage developers to build more dense housing. Innovative approaches such as municipal acquisition funds for affordable housing, community land trusts and local land banks can better ensure housing is available for existing residents as well as future migrants. None of this is realistic, of course, without local enthusiasm and the deep pockets of Washington.

* * *

It’s hard to get our heads around the reality that, tens of millions of Americans will likely be forced to move in the coming decades. And there’s certainly a long tradition of letting migration happen when it happens, turning our backs on those directly affected. Think: deindustrialization of New England after the Civil War, abandonment of the Dust Bowl in the 1930s, the hollowing out of the Midwest in the 1980s.

But this time is different – or it had better be. Left to their own devices, there’s every reason to believe climate refugees will relocate to places almost as vulnerable to natural disaster. As a consequence, the problem will fester, perhaps even triggering rapid, discontinuous abandonment of much of the Sun Belt as conditions grow intolerable and the mortgage and insurance industries abandon ship. Such unplanned moves would be incredibly expensive and traumatic to both the climate migrants and the regions in which they land.

We could do better. The big question is whether America can muster the foresight to plan for change that is bound to stress the already frayed fabric of American society.

Large population movements are destabilizing, and nobody wants to be forced to abandon their home. But climate migration is likely an inevitability, and the best we can do is ensure that it occurs under the most favorable conditions. The key is providing future migrants with the right incentives to overcome the inertia of staying put and to relocate to more resilient climate havens.