Coastal Real Estate Can’t Seem to Price Climate Risk
Too few homebuyers have the right information to make decisions amid rising sea levels. Some states are moving in the right direction, but not enough.
The housing market has been insufficiently discounting the risk of rising seas.
Photographer: Joe Raedle/Getty Images
Asset prices are supposed to reflect risk, but the coastal real estate market has been challenging that notion for years. Not only is the threat of rising seas not “priced in,” but many of the most vulnerable markets in the country — think Florida — are also among the frothiest, with Miami area home prices up around 64% since 2019. Logically, buyers must either lack information about the climate threat or they’re intentionally choosing to disregard it, perhaps under the influence of climate-skeptical politicians.
Let’s start with the former — arguably the biggest source of concern and opportunity.