Seismic behaviour of typical unreinforced masonry (URM) brick house, is experimentally investigated. A one half-scale model URM house with aspect ratio of 1.5:1 in plan is constructed and tested under earthquake ground motions on a shaking table, in the longitudinal direction for several earthquakes with peak ground acceleration (PGA) up to 0.5g. The structure was then rotated 90º and tested in the transverse (short) direction for ground motions with PGA up to 0.8g. A finite element analysis and a mechanism analysis are conducted to assess the dynamic properties and lateral strength of the model house. Seismic fragility function of URM houses is developed based on the experimental results. Damping at different phases of the response is estimated using an amplitude dependent equivalent viscous damping model. Financial risk of similar URM houses is then estimated in term of expected annual loss (EAL) following a probabilistic financial risk assessment framework. Risks posed by different levels of damage and by earthquakes of different frequencies are then examined.