Sound ominous? Maybe, maybe not. A new climate outlook report from a non-profit climate watch group (as initially reported in USA Today) indicates that within 30 years, rising tides could put up to 637,000 homes or properties on the oceanic coast(s) of the USA underwater. Should we be concerned about climate change? Yes. Is climate change going to put 637,000 properties under water in 30 years? Uncertain. So what does it mean for real estate owners and operators?
Let’s take a look at the situation from two perspectives. First, if we know that rising waters are going to be a concern along the coast, then there are steps that can be taken to mitigate the potential issue. If these properties were in a flood zone typically in any other part of the USA they would likely lose value, but that is not likely to happen on an oceanic location because of ongoing desirability by countless people to be near the ocean. Not to panic, but we do need to act sooner than later. Secondly, we could say that properties near but not on the coast are also likely to increase in value if in this instance, these secondary locations may eventually become more beach locations. Sound cold? Maybe. It is a perspective from which to view opportunity, not withstanding the need to be empathetic, understanding, and supportive of changes that should still be taken to arrest the negative effects of climate change.
We want to be clear that we are sympathetic to property owners that could be facing this reality in 30 years, but with that said, you can talk about it or you can act on it. We are on the sides of taking action to mitigate the growing problems that affect real estate values whatever they may be, but at the same time we strive to remain pragmatic and evaluate the facts. The fact is that when other people run from a problem, we look for the opportunity. As a real estate operator, in our experience, we get paid to fix other people’s problems. Like flipping a home, offering a rental, developing lots, etc. All we are saying here is that a potential problem could be a potential opportunity. Let’s work together to do what is right in regard to climate change, but let’s also be smart about solving problems and making profit. Thoughts?
We can not and do not offer tax, accounting, financial, legal, nor investment advice.