In a recent report from Zillow, according to climate scientists, if sea levels rise as much as predicted by the year 2100, almost 300 U.S. cities could potentially lose at least half their homes as well as 36 U.S. cities could be completely lost. If this situation takes place based on Zillow's calculations, it may turn out that actual water poses almost as much of a problem for the housing market in the future as negative equity has in the past.
The report also notes that with these predictions, it’s possible that one in eight Florida homes could be underwater which would account for nearly half of the lost housing value nationwide. Zillow says that typically when discussing “underwater homes” it is in reference to homes with negative equity, put it is seemingly possible in their opinion that this term could be used in the future in a more literal sense referring to millions of homes worth hundreds of billions of dollars being inundated.
Currently the median value of a home under this risk of being underwater is $296,296 compared to the average home sitting at $187,000. The reports states that, based off of their calculations, it may turn out that actual water poses almost as much of a problem for the housing market in the future as negative equity has in the past.
Zillow quantifies the impact of rising sea levels by using maps released by the National Oceanic and Atmospheric Administration (NOAA) to show which parts of costal states will be underwater if sea levels rise by six feet. They use six feet due to estimates that suggest sea levels will rise to that height by the year 2100 if climate change continues on its projected levels.
This data from Zillow used in conjunction with their database of information on homes nationwide, added them in determining which properties were at risk of being submerged to at least their ground floors in the next century along with what they’re worth as of now.
The report cites almost 1.9 million homes or roughly 2 percent of all U.S. homes worth a combined $882 billion are at risk of being underwater by 2100. The properties potentially affected in Florida are expected to be worth more than $400 billion in current housing value. In comparison to the statistic of 1 in 8 homes being at risk in Florida, it was also found that in Hawaii almost 1 in 10 homes are at risk.
Zillow shares that given the risk that Florida and Hawaii face, Miami and Honolulu likewise top the list of large cities with a significant number of properties at risk from rising sea levels. Additionally, more than 1 in 6 Boston homes are at risk as well as almost 3 percent of homes in New York City if sea levels rise in line with climatologists’ predictions.
Zillow makes a point to note that the year 2100 is a long way off, and it’s certainly possible that communities take steps to mitigate these risks. Either way, Zillow says that if left unchecked, the threats posed by climate change and rising sea levels have the potential to destroy housing values on an enormous scale.