Along coastlines, some homes that are currently high and dry could be flooded as seas rise over the next century. The threat may be several decades away, but the real estate market is already responding.
Ryan Lewis of the University of Colorado is part of a team that analyzed hundreds of thousands of coastal real estate transactions over a decade.
They compared the sale prices of homes that were similar in almost every way: same size, same zip code, and the same distance from the beach.
Lewis: “The difference is either one house is slightly higher than the other, or one house is protected by natural features.”
In other words, two identical homes – one more likely to flood in the future, and one less. The analysis found that more vulnerable properties sold, on average, for about seven percent less.
Lewis says the difference is mainly driven by real estate investors. They’re often more aware of the threats posed by sea-level rise, so they offer less for at-risk properties.
But individual home buyers may be less informed.
Lewis: “We want these people to be more aware of the risk and hopefully paying a discount or maybe even just choosing a different property if this is not a risk that they’re willing to face.”
Reporting credit: Sarah Kennedy/ChavoBart Digital Media.