One of global warming’s most inconvenient truths is that it’s already beginning to put some of America’s most valuable real estate under water. Never mind storms – even high tides now swamp some low-lying areas. As the New York Times reports, its impact on real estate prices has (so far) crept in just as slowly, but fears are rising that coastal real estate is becoming a bubble:
State lawmakers in Massachusetts and New Jersey are pushing to impose new rules on real estate agents and others, obligating them to disclose climate-related damage like previous flooding.
Banks and insurers need to protect their collateral and investors more by improving their methods for estimating climate-change risks and creating more standardized rules for reporting them publicly, economists warn.
In April, Sean Becketti, the chief economist for Freddie Mac, the government-backed mortgage giant, issued a dire prediction. It is only a matter of time, he wrote, before sea level rise and storm surges become so unbearable along the coast that people will leave, ditching their mortgages and potentially triggering another housing meltdown — except this time, it would be unlikely that these housing prices would ever recover.
My wife and I have been house-hunting along the SouthCoast in places like Mattapoisett, Fairhaven and Marion for the last several months. I can verify that most real estate agents won’t volunteer a damn thing – even whether the home currently has flood insurance! Agents that know every detail about the crown molding suddenly act befuddled when you ask how often the basement floods. And you have to ask at every single home, even ones a mile or more from the ocean. You’d be shocked at how many homes are threatened by a little stream a hundred feet into the woods out back that would serve as an HOV lane for a hurricane storm surge.
Think about the cascading effects. It’s not just the hundreds of thousands of homeowners whose properties could be financially underwater:
- What happens to the property-tax reliant schools in those communities?
- What about the public roads & other infrastructure that are repeatedly getting swamped?
- And with Congressional Republicans firmly in denial, refusing to provide significant funds for climate preparation, these communities whose budgets are getting busted are also expected to be funding sea walls?
One small step that Congress could take would be properly-pricing federal flood insurance – but so far it’s refused to do even that.
As long as Americans keep electing politicians who deny global warming and resulting sea level rise, we’ll keep ignoring the bubble as it grows ever larger.