California’s real estate market is constantly evolving, shaped by new laws, environmental challenges, and a shifting insurance landscape. One of the most significant changes taking effect this year impacts how sellers disclose wildfire risks to potential buyers. As of July 1, 2025, California’s new fire risk disclosure rules have been expanded, adding new responsibilities for sellers and providing critical information for buyers.

For those of us in Berkeley and the surrounding East Bay, these changes are particularly important. Our beautiful hillsides and lush vegetation make for inviting neighborhoods, but they also bring a heightened risk of wildfire—especially in areas designated as High or Very High Fire Hazard Severity Zones (FHSZ) by CAL FIRE. Understanding these rules will help you navigate transactions smoothly, avoid surprises, and protect your investment for years to come.

Why Fire Risk Disclosure Matters

Wildfires have become a defining characteristic of California home ownership. In recent years, we’ve witnessed unprecedented fire seasons that have impacted housing availability, insurance markets, and property values across the state. A study published by Resources for the Future found that clearly disclosing wildfire risk can reduce a property’s sale price by 4.3% on average, underscoring just how much this information influences buyer decisions.

But transparency has benefits beyond price adjustments. When buyers understand the risks upfront, they’re better equipped to plan for defensible space improvements, secure appropriate insurance coverage, and budget for long-term maintenance. For sellers, thorough disclosure isn’t just a legal requirement—it builds trust and reduces the likelihood of disputes after closing.

The Natural Hazard Disclosure (NHDS)

At the heart of California’s system is the Natural Hazard Disclosure Statement, required by law for nearly every home sale in the state. This standardized form covers six key natural hazards, including flood zones, earthquake fault zones, and—most relevant to us—wildfire risk.

Every seller must provide this disclosure to buyers, either by filling it out directly or by commissioning a third-party report. In addition to the standard disclosure that sellers complete, I also order a detailed Natural Hazard Disclosures (NHD) report from a vendor that has a large set of natural hazard data and maps and ensures accuracy and completeness. In Berkeley, this report will indicate whether the property lies within a Very High Fire Hazard Severity Zone or other designated areas of concern.

Defensible Space Requirements: AB 38

In 2019, California introduced Assembly Bill 38 (AB 38) to further strengthen wildfire preparedness. This law applies to residential properties with one to four units located in High or Very High FHSZs. The law requires that sellers disclose to buyers six categories of property features that may make the property vulnerable to wildfires and flying embers. This disclosure is only required if the seller is aware of any of the identified vulnerabilities.

These categories include:

• Eave, soffit, and roof ventilation where the vents have openings in excess of one-eighth of an inch or are not flame and ember resistant.
• Roof coverings made of untreated wood shingles or shakes.
• Combustible landscaping or other materials within five feet of the home and under the footprint of any attached deck.
• Single pane or non-tempered glass windows.
• Loose or missing bird stopping or roof flashing.
• Rain gutters without metal or noncombustible gutter covers.

Local programs like Berkeley’s EMBER initiative add another layer of protection by requiring a five-foot “Zone 0” clearance around certain high-risk homes. This is one of the most effective ways to prevent embers from igniting structures during a wildfire. As a real estate agent, I’ve seen firsthand how compliance with these rules not only improves safety but also enhances a property’s value and insurability.

The 2025 Update: Fire Hardening Retrofits Disclosure

Starting July 1, 2025, California’s new fire risk disclosure rules require sellers of homes built before 2010 must take an additional step: clearly indicating whether they have completed any of 12 specific low-cost fire-hardening retrofits. These measures are designed to make homes more resistant to ember intrusion and direct flame contact. Examples include:

• Upgrading attic and crawl space vents to ember-resistant designs
• Installing gutter guards to prevent debris accumulation
• Enclosing eaves to eliminate exposed openings
• Replacing single-pane windows with dual-pane tempered glass
• Using non-combustible fencing within five feet of the home

Even if none of these upgrades have been completed, sellers are required to explicitly state that fact. This new rule is about full transparency, giving buyers a clear understanding of the home’s current level of wildfire preparedness.

Insurance Challenges and the FAIR Plan

Disclosure is just one piece of the puzzle. In recent years, many insurance carriers have scaled back or withdrawn coverage in high-risk areas, leaving homeowners scrambling for alternatives. In Berkeley’s hills, it’s increasingly common for buyers to turn to the California FAIR Plan, the state’s insurer of last resort.

While the FAIR Plan provides essential coverage, it’s typically more expensive and less comprehensive than private insurance policies. Combining a FAIR Plan policy with a supplemental “wrap-around” policy is often necessary to achieve adequate protection. When counseling my clients, I always emphasize the importance of starting the insurance conversation early in the buying process—ideally before making an offer. This proactive step prevents unpleasant surprises during escrow.

Building a Fire-Safe Future

Wildfire risk is a reality of life in California, but it doesn’t have to be a deal-breaker. By embracing transparency and taking proactive steps, we can make our communities safer and more resilient. California’s new fire risk disclosure rules are part of a broader effort to align real estate practices with the environmental challenges we face.

As someone who has lived and worked in Berkeley for many years, I’ve seen how our neighborhoods evolve in response to these changes. From the historic homes of North Berkeley to the modern builds in the Claremont Hills, each property has unique characteristics—and unique risks. My role is to help my clients navigate this complex landscape with clarity and confidence.

If you’re considering buying or selling a home in Berkeley, let’s talk about how these new rules apply to your situation. Together, we can create a strategy that protects your investment, supports compliance, and ensures a smooth, stress-free transaction.