Although the phrase “my home is underwater” is never good news, in the near future it may take on even more dire ramifications for coastal communities, including those in the larger Bay Area.
On Tuesday the Union of Concerned Scientists [UCS]—a non-profit science advocacy group that lobbies for policy to circumvent potential environmental disasters—released a 28-page study reviewing the possible dangers of sea level rise to coastal real estate markets.
The product of several UCS climate scientists and analysts, the paper titled “Underwater: Rising Seas, Chronic Floods, and the Implications for U.S. Coastal Real Estate” proposes that potential sea level rise over the next 30 to 80 years could render valuable waterfront real estate worthless, with losses in the U.S. exceeding $1 trillion in the worst case scenario.
Although San Francisco is actually spared the worst of it in the UCS analysis, the rest of the Bay Area isn’t so lucky. Some takeaways:
- Market activity reveals that Americans are not really taking flood risk seriously: “Hundreds of thousands of buildings lie in the path of rising seas. [...] Yet property values in most coastal real estate markets do not currently reflect this risk. And most homeowners, communities, and investors are not aware of the financial losses they may soon face.”
- The biggest risk may not be just to homeowners and coastal communities but to the larger economy: “The consequences of rising seas will strain many coastal real estate markets—abruptly or gradually, but some eventually to the point of collapse—with potential reverberations throughout the national economy. And with the inevitability of ever-higher seas, these are not devaluations from which damaged real estate markets will recover.”
- Although the problem is only barely visible now, there’s a short period in which to act: “Sea level rise are growing and risk perceptions in the marketplace can shift abruptly, both of which leave communities vulnerable to economic hardships that many will not be able to cope with on their own. [...] The cliff ’s edge of a real estate market deflation due to flooding and sea level rise is already visible for many communities if they choose to look.”
- In the Bay Area, thousands of properties risk being flooded out in the next 30 years—none of which are in SF: “San Francisco itself has just 270 at-risk homes in 2045. [But] in the nine counties surrounding the San Francisco Bay roughly 13,000 properties—home to more than 33,000 people and valued at $8.6 billion today—are at risk.”
- Potential damage and loss of value will not fall equally on all Americans: “Communities with fewer resources to start with, or that are otherwise disadvantaged, will likely be most heavily affected by chronic flooding and its accompanying financial losses,” including communities with higher poverty rates and higher populations of “traditionally underserved groups—African Americans, Hispanic Americans, and tribal communities.”
A few caveats: UCS based estimates about properties and home values on present-day Zillow data.
Obviously by 2045 there will be more homes and much different property values in the Bay Area and other coastal regions, but the research doesn’t try to speculate about what those may be.
Notably, this means that waterfront developments in places like Mission Bay and Treasure Island are also not accounted for in the future projections.
Note also that the flood risks presented in the paper are based on “a scenario that results in 6.6 feet of global sea level rise by 2100.”
No one actually knows for sure at what rate sea levels may rise over the next century—because nobody can see the future, of course—and possible scenarios with a slower rate of ocean encroachment would presumably result in smaller losses.
Then again, homeowners shouldn’t ignore the possibility of even more drastic ocean conditions than those used in these projections either. Risk and uncertainty go hand in hand when it comes to the coastline of the future.
You can read the full report here.