Climate Will Have Real Estate Impacts -and Soon

July 2, 2018

New study looks at chronic flooding risk in coming decades from climate warming with subsequent sea level rise and tidal flooding.

Bloomberg:

Even as President Donald Trump downplays the importance of climate change, there are signs that Americans may be taking it more seriously—at least when it comes to buying a house.

Between 2007 and 2017, average home prices in areas facing the lowest risk of flooding, hurricanes and wildfires have far outpaced those with the greatest risk, according to figures compiled for Bloomberg News by Attom Data Solutions, a curator of national property data. Homes in areas most exposed to flood and hurricane risk were worth less last year, on average, than a decade earlier.

Attom Data looked at the annual change in home prices and sales across 3,397 cities around the country, then divided those cities into five groups based on their exposure to various types of natural disasters. What they found suggests the threats of climate change are beginning to register.

On average, home prices across the cities analyzed by Attom Data increased 7.3 percent between 2007 and 2017. That figure masks deep drops in vulnerable areas.

“Natural disaster risk is certainly not the only factor consumers are considering when buying a home,” said Daren Blomquist, Attom Data’s senior vice president for communications. But he said the figures provide “some evidence real estate consumers are responding to natural disaster risk, albeit somewhat erratically.”

Inside Climate News:

Most people check out Zillow, a popular online real estate app, for information on how many beds and baths a house includes, or the quality of local schools, or how long a home has been on the market.

But climate experts at the Union of Concerned Scientists (UCS) saw Zillow as just the kind of big data needed to better inform assessments of the risks of flooding to properties around the nation’s rim. And looking at the app through that screen, they have turned up some troubling visions.

Property losses in the United States could run into the hundreds of billions of dollars unless rapid action is taken to bring climate change under control, they warned in a study released Monday.

The owners of more than 150,000 existing homes and commercial properties, worth $63 billion, could find their assets at risk from repeated flooding in the coming 15 years. That risk could double by 2045.

This is, of course, homes that are often people’s single biggest assets,” said Rachel Cleetus of the UCS. “This is about entire communities that might find much of the property in their community gets inundated, and that might affect their community tax base.”

By the end of the century, if seas rise by 6.6 feet—a high, but not worst-case projection in the 2017 National Climate Assessment—the damage could be staggering.

More and more houses will be hit by more and more floods, some so frequently that they are essentially not fit to live in.

More Homes at Risk of Chronic Flooding

The study focused on properties at risk of chronic flooding, which it defines as flooding at least 26 times a year.

If sea level rises more than 6 feet by the end of the century, UCS estimated that the homes of more than 4.7 million people will be at risk of chronic flooding. With commercial properties included, that’s more than $1 trillion in value, and it doesn’t take into account future development or rising property values.

Even with 4 feet of sea level rise, the homes of more than 2 million people, plus many commercial properties, are likely to face chronic flooding.

 

If global warming is controlled in line with the goals of the Paris climate agreement, sea level rise and the damage it causes would be less. To lessen the impact, greenhouse gas emissions would have to be brought to zero within a few decades, scientists say.

‘A Lot of People Are Unaware of What’s Coming’

“Coastal real estate markets currently, for the most part, are not reflecting this risk,” Cleetus said. “A lot of people are unaware of what’s coming, and that is cause for deep concern.”

Andrew Teras of Breckinridge Capital Advisors, which specializes in municipal bonds, said investors should heed the implications for property values and property taxes.

The risks are not faced exclusively by thriving communities and wealthy individuals with seaside houses. In Norfolk, Virginia, for example, businesses and a variety of neighborhoods, including a large public housing development, already face frequent nuisance flooding, and officials are trying to figure out how to protect as much of the city as they can.

Low-Income Communities at Risk

Nearly 175 communities nationwide could see 10 percent or more of their housing stock at risk of chronic flooding by 2045 if seas keep rising under the high sea level rise scenario. Nearly 40 percent of them are low-income communities with poverty levels above the national average.

Rob Moore, a senior policy analyst with the Natural Resources Defense Counsel who was not involved in the current study, said the focus on low-income communities is often overlooked in discussions about sea level rise.

“Many people immediately think this is just affecting affluent people who live at the beach,” he said. “They don’t understand that this type of flooding affects areas further inland, and often lower-income communities.”

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11 Responses to “Climate Will Have Real Estate Impacts -and Soon”

  1. rhymeswithgoalie Says:

    That’s one of the ironies of the Puerto Rican emigration: Many are going to live in “affordable” neighborhoods in Florida.

  2. dhra6ih Says:

    Great article. Go through the details: https://goo.gl/ZhaaxZ

  3. dumboldguy Says:

    Article in today’s WashPost about decline in real estate values in Charleston, SC. Cites some new studies and new methodologies.

    https://www.washingtonpost.com/national/health-science/sea-level-rise-is-eroding-home-value-and-owners-might-not-even-know-it/2018/08/20/ff63fa8c-a0d5-11e8-93e3-24d1703d2a7a_story.html?

  4. Charusheela Omana Says:

    very nice article real estate is a vast field. technology and other factors are also affecting it.You can check this article also to relate other things

    https://virily.com/home-gardening/heres-all-what-you-need-to-know-for-your-first-home-in-south-india/


  5. […] via Climate Will Have Real Estate Impacts -and Soon — Climate Denial Crock of the Week […]

  6. CRC Sublimis Says:

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  7. Rsfhestates Says:

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  8. vatlieuxaydungsg Says:

    Article in today’s WashPost about decline in real estate values in Charleston, SC. Báo giá đá xây dựng Cites some new studies and new methodologies.

  9. Simple Transactions Says:

    Hello,
    Your article is good. And yes, you are right climate will have Real Estate impact. Can you tell us that how can we stop the property loses in United State?

    • greenman3610 Says:

      begin adaptation efforts in areas that are vulnerable. prepare to pull back from areas that cannot be saved. reconsider zoning or other incentives for building in vulnerable areas. review federal flood insurance and other programs that may encourage risky behaviors.
      Remember problem is not just flooding, but places like Paradise, CA, overbuilding in fire-prone areas that will only become more so. Yes, review forest management practices (although that was not a dominating factor in recent CA fires)
      Start talking now about how much the nation is willing to spend to help bail out those who have life savings tied up in properties that cannot be saved.
      And stop emitting greenhouse gases. ASAP.


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