Nate

seawater is only used selectively because its salt content corrodes metal pumps and hydrants, lessens the cooling effects of the water, and wreaks havoc with the environment by increasing soil salinity, which can prevent plants and seeds from absorbing water

This lime from farther down in the article has come as new news to me during these current wildfires. It seems like California is simply a location that does not possess enough fresh water to combat fires of this magnitude. Not to say that there necessarily is anywhere else that would be able to fight/win against these fires.

Would this not most likely still cause the same kind of financial collapse in the housing market that was mentioned as a possibility in the article linked by OP? If it is not possible to get insurance for an event (i.e. wildfire) that is likely(/definitely going) to occur, then I imagine buyers/real-estate developers would be less inclined to pay high prices in those regions.