How Climate Change Will Affect Real Estate
Q: Gerald, how will climate change affect real estate? Evan, Toms River, NJ
A: Climate experts predict that 2% of US homes are at risk of being underwater by 2100 and in low-lying coastal areas in places like Florida & Hawaii, over 10% of homes could be inundated by water. The fact is that rising water levels, heat waves, droughts and wildfires will for sure increase the cost to insure property and local government building ordinances and re-building guidelines will affect where and how property will be built in at risk areas like in coastal areas. In New Orleans for example, after hurricane Katrina, homes have been rebuilt at higher elevations, with storm shutters, stormproof windows and draining systems. Real estate prices are driven primarily by supply and demand and a new business school study shows that at risk homes sell for more money in areas where people don’t believe in climate change, so the short term risk to housing prices by climate change will likely vary from place to place, however, at the end of the day, climate change will affect real estate nationally and internationally in a profound way. Thanks for your question, Evan.
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