More than a decade ago, David Burt, then an investing consultant at Cornwall Capital, was one of the few investors to bet against the exploding housing market, prior to the 2008 crash. Burt is betting on the mortgage market crashing again, only this time climate change will be at fault.

Burt, in an exclusive interview published Friday by Vice, said he believes there could be another bubble set to burst and it’s being artificially inflated by climate change denial. 

“There’s a lot of parallels, it’s a big real estate mis-pricing issue,” Burt told Vice. “At its core that presents a lot of the same risks.”

David Burt | DeltaTerra Capital

David Burt | DeltaTerra Capital

“A lot of real estate is massively overpriced and there’s a lot of risk associated with that and the big risk is another foreclosure crisis,” Burt added. “Now, it’s a very different dynamic that’s creating the mis-pricing but actually magnitude-wise it looks pretty similar, maybe even bigger.”

Burt was an investing consultant at Cornwall Capital in the run up to the financial crisis, one of the firms that successful bet against the housing market. Cornwall Capital was profiled in the book, The Big Short: Inside the Doomsday Machine, and his colleague from the firm was portrayed by Brad Pitt in the film adaptation.

Burt’s position was first published by Reuters in September. He recently started DeltaTerra Capital, a firm that helps clients manage the risks of climate change. DeltaTerra Capital, according to Reuters, is currently targeting mortgage-backed securities with exposure to areas prone to the impacts of climate change like Texas or Florida.

“The market’s failure to integrate climate science with investment analysis has created a mispricing phenomenon that is possibly larger than the mortgage credit bubble of the mid-2000s,” Burt wrote in a presentation to prospective clients, obtained by Reuters.

Attom Data Solutions’ most recent Natural Hazard Housing Risk, published in September 2018, actually found that prices were appreciating at a much higher rate in cities at the greatest risk of being impacted by natural disasters. The study found that home price appreciation in highest-risk natural hazard cities was 1.7 times the overall market rate over last decade, in 2018.

Foreclosure risk was also higher in more flood-prone areas, according to the study.

Homeowners themselves are still slow to make changes, based on climate change. Less than half of homeowners are worried about climate change, according to a recent study from Value Penguin and only forty-two percent of homeowners say they’re unwilling to pay higher insurance costs.

Email Patrick Kearns

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