[throwaway984393]

Yeah failure from heat is one thing, but another is how quickly the structure catches fire or spreads it. Another commenter linked the 99PI piece how they found out that embers were getting through vents in roofs (you need those vents because your house is a weird little ecosystem) and catching the inside of the roof on fire. And if the outside is made of wood, it's more likely to catch than, say, concrete or brick.

The material you're more likely to use for a home if it's not wood is concrete or brick with some steel added. Concrete and brick are very fire resistant, which would make it much harder for a building to catch, and so harder for fire to spread if the building doesn't catch. The reason our homes in the US aren't brick (anymore) is it's a very expensive/specialized job, but wood framing is easy in comparison and wood is cheap here (and we have a lot of lumber mills to churn out small standardized pieces)

The inside would of course burn eventually if engulfed in a slow-moving fire with plenty of fuel, because things ignite when they get hot enough (or turn to charcoal if there's not enough oxygen). But if you're lucky the fire will move past quickly or run out of fuel, so every little advantage helps.