The spatial relationship between areas with severely damaged (red-tagged) buildings and areas with large strains in the soil (indicated by reported breaks in the water distribution system), observed during the 1994 Northridge earthquake, is analysed. It is shown that these areas can be separated almost everywhere. Minimal overlapping is observed only in the regions with very large amplitudes of shaking (peak ground velocity exceeding about 150 cm s(-1)). One explanation for this remarkable separation is that the buildings on 'soft' soils, which experienced nonlinear strain levels, were damaged to a lesser degree, possibly because the soil absorbed a significant portion of the incident seismic wave energy. As a result, the total number of severely damaged (red-tagged) buildings in San Fernando Valley, Los Angeles and Santa Monica may have been reduced by a factor of two or more. This interpretation is consistent with the recorded peak accelerations of strong motion in the same area. It is concluded that significant reduction in the potential damage to wood frame single family dwellings may be expected in areas where the soil experiences 'large' strains (beyond the linear range) during strong earthquake shaking, but not significant differential motions, settlement or lateral spreading, near the surface. (C) 1997 Elsevier Science Ltd.