With six-month summers, long and intense heat waves, forest fires, floods and droughts, the consequences of climate change are being felt more and more in all countries. Natural events that also have an impact on real estate. In fact, extreme weather conditions such as can adversely affect the housing market, lowering the price of homes that may be affected.

It’s a trend that will mean that over the next 10 years homeowners in wealthy countries will have to try to sell their homes before buyers realize the climate risk.

Oregon case. In Oregon (United States), property owners fear that the state will devalue their property by posting fire risk notices. They organized and staged protests for months when the government tried to impose new restrictions on homeowners in vulnerable areas or even inform them about the risks they faced. And to some extent their complaints were justified: When the government released a map of the condition and risks of each home, these neighbors’ homes fell in value and became much more difficult to sell.

And it is paradoxical. Because, like many other climate change adaptation efforts around the world, Oregon’s wildfire program has faced the most backlash from the people it’s tried to help.

The effect of floods on real estate prices. A study by the Intact Center on Climate Adaptation (ICCA) set out to find out if community-level flooding is affecting residential real estate in single-family, semi-detached and row houses in Canada. The results showed that climate events, especially floods, can reduce the price of a house by 8.2%. Also, a house in a flood-free area sells for 22% more than a house sold.

However, there are some more unfortunate numbers in this other British study. He analyzed the price trend of properties affected by flooding in England between 1995 and 2014. The results show that the price of a property is on average 24.9% lower after a flood.

more expensive to insure. Not only that, as climate change threatens more countries with more natural disasters, it’s getting more expensive and worse to insure your homes, according to experts. The rise in catastrophic weather losses, coupled with rising rebuilding costs, labor shortages, and “spikes in demand” has led to higher homeowners’ insurance premiums. It’s already showing: Almost 90% of homeowners saw an annual average of €134 more premium growth from May 2021 to May 2022.

California plan. As we report in this Magnet article, the state of California has proposed a law to provide loans to counties to allow them to purchase these flood-prone waterfront homes. And then rent these properties, either to the original owner or to another person, until the house is no longer safe to live in, and use the money from the rent to pay off the initial loan from the government. Sort of like a city-run Airbnb, profits go to making sure no one pays the bill when Pacific comes to collect.

It happens in Europe too. And it’s not just a US coast problem. We also experience this in Europe. more than half of its territory The Netherlands is located at or below sea level and its buildings are equally threatened. The government came up with such an idea. promote the famous houseboat (dwellings built on underground tanks) is a concept that has already evolved into floating communities. Spain and Portugal are other countries that will experience these changes radically. And the housing market is already paying attention to what’s going on.

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