As Sea Levels Rise, Property Values Will Sink

June 18--In findings released today, the Union of Concerned Scientists reports that -- of all the coastal states in the lower 48 -- Florida has the most existing homes at risk of eventually experiencing chronic flooding caused by rising sea levels.

That flooding, the researchers warn, could make those residential properties no longer practical to inhabit, much less insure, rent or sell -- causing their market and taxable values to plummet.

Founded in 1969, the Union of Concerned Scientists explores how public policy and welfare are affected by science-based issues -- such as nuclear power, food production and climate change. On the latter topic, the organization -- which consists of 200 staff members and 23,000 science network members from diverse fields -- is engaged in an ongoing exploration of how global warming could cause sea level rise in 23 coastal states in the continental United States (excluding Alaska).

For a study titled "Underwater: Rising Seas, Chronic Floods and the Implications on U.S. Coastal Real Estate," the UCS partnered with the online real estate appraisal firm Zillow and consulted with dozens of experts in finance, municipal bonds, property management, risk management and other fields.

The researchers concluded that, by 2045 (roughly the span of a current 30-year mortgage), about 64,000 residential properties in Florida could experience "chronic inundation." The UCS describes "chronic inundation" as tidal flooding not related to any storm that occurs 26 times a year or about every two weeks.

Those 64,000 properties currently have a market value of about $26 billion and a taxable value of nearly $350 million.

By 2100, the UCS predicts that more than 1 million existing Florida residences could experience chronic inundation. Those properties currently have a market value of more than $351 billion and a taxable value of roughly $5 billion.

Erika Spanger-Siegfried, a lead climate analyst for UCS, said a family's home is likely to be their "single greatest asset" and a major part of their "financial legacies." By making their data public, the researchers want residents along the 13,000 miles of U.S. coastline they reviewed to assess their risks.

Spanger-Siegfried said residents need to realize the actual "time horizons" between when they make an investment decision in a waterfront property and when that land could become exposed to rising tides.

She said the researchers hope to create among homebuyers, real estate businesses, local governments and others "a real awareness that the financial risks are real, significant and largely unaccounted for."

By the turn of the century, the report states, Florida could have 40 percent of the homes in coastal states (excluding Alaska and Hawaii) where substantial sea level rise is expected.

New Jersey is listed next with 250,000 impacted homes with current market values of $108 billion and taxable values of $1.9 billion. New York ranks third with 143,000 impacted homes with current market values of nearly $100 billion and taxable values of $1.7 billion.

The report also predicts sinking values for other New England, Southern and west coast states in the lower 48. By the end of the century, nearly 2.5 million residential and commercial properties in the coastal states examined in the study -- valued at $1.07 trillion today -- could be literally under water.

Defend, accommodate or retreat

"Properties will not be the only things to flood," the study notes. "Roads, bridges, power plants, airports, ports, public buildings, military bases and other critical infrastructure along the coast also face the risk of chronic inundation."

The researchers did not attempt to even estimate those potential costs. Yet they emphasize that shrinking property tax bases will greatly hamper local efforts not just to deal with sea level rise but continue to provide basic services, such as schools and public safety, without a significant tax rate hike.

They also stress that they could not factor in other potential variables such as population growth, additional coastal development, the impact of major storms and any adaptation measures that communities may take but have yet to build to better prepare for higher tides.

Another factor yet to be weighed could pertain to the affordability of real estate. If Florida developers start seeking higher ground, they could start buying out, gentrifying and redeveloping lower-income neighborhoods -- pricing out working class families.

Although the study mainly focused on homes, it also looked at commercial properties. It indicates that 30 percent of the 2,300 commercial properties in Florida that are "at risk" by 2045 and 50 percent of the 38,000 at risk in 2100 are office buildings.

The union based its overall projections on what climate scientists regard as the "high scenario" for sea level rise in Florida -- averages of 1.8 feet by 2045 and 6.4 feet by 2100.

Climate scientists believe sea levels are rising because the burning of fossil fuels traps atmospheric heat, which warms and expands ocean waters and contributes to the melting of ice sheets.

The UCS emphasizes that "a rapid decrease in carbon emissions coupled with slow melting of land-based ice could lead to substantially lower rates of sea level rise."

Yet, so far, that is not happening.

Although many nations remain committed to the Paris Accord goals of reducing air pollution, the United States pulled out of the agreement, and many developing nations want to become more industrialized.

The UCS study also comes on the heels of findings published last week by a team of 80 scientists in the journal Nature that Antarctica's ice sheet is melting at a rapidly increasing rate. They estimate that more than 200 billion tons of Antarctic ice is entering the ocean annually and raising sea levels a half millimeter each year, a rate that has tripled in the past decade.

The UCS report urges decision-makers to start planning now to follow one of three strategies or a combination thereof: defend, accommodate or retreat.

Communities can invest in infrastructure that defends their coastlines, find means of accommodating and routing the incoming water or remove structures in the path of future flooding and replace them on higher ground.

"We should be stopping the things we're doing today that are putting people in harm's way," Spanger-Siegfried said.

Numerous Florida coastal communities -- such as Miami Beach, Satellite Beach, Punta Gorda and Sarasota -- are assessing their risks and planning ahead. Yet many have not.

The UCS researchers stress that, if communities wait too late, market property values will be unable to recover from persistently chronic flooding as they would after a typical economic downturn.

"There are thresholds for communities beyond which economic and financial viability, and crucial public services, are threatened," the study concludes. "When enough of those households and communities falter, entire real estate markets face a tipping point. Whether we react to this threat by implementing science-based, coordinated and equitable solutions -- or walk, eyes open, toward a crisis -- is up to us right now."

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