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Learning, Sharing, and Teaching => Real Estate and Landlording => Topic started by: former player on October 30, 2019, 08:03:49 AM

Title: Real estate purchases and climate change
Post by: former player on October 30, 2019, 08:03:49 AM
A BBC article has alerted me to this map -   https://coastal.climatecentral.org   -   with variables for coastal flooding (the news was mainly related to changes in known land levels in asia but the map is global).

The default timeline is set to 2050, just when someone now taking out a 30 year mortgage would have paid it off.

Of course I checked out the locations of houses I own and have previously owned.  A house I sold 3 years ago could be well underwater by 2050, my current ones are OK but infrastructure such as motorways and main line rail, and the centre of the nearest shopping town could all be badly affected.  I would quite like still to be around in 2050 so even if all else was normal daily life could be very different.

Is anyone who is looking to buy real estate thinking this far ahead?  If real estate value/liveability is a factor in your retirement income then 30 years doesn't seem too far to be looking ahead.
Title: Re: Real estate purchases and climate change
Post by: ysette9 on October 30, 2019, 09:23:28 AM
I actually think about this but more on the side of heat and rain/water. I hate the heat and love the rain, and with climate change my area is getting hotter and drier. I want to move north to get back to a nice climate for the future. I also selfishly want to be able to take a hot bath on occasion without feeling guilty for using so much water. ;-)
Title: Re: Real estate purchases and climate change
Post by: J.R. Ewing on October 30, 2019, 09:32:25 AM
Sea level is rising at 3.3 millimiters per year, and it's been fairly consistent over the 20th and 21st centuries.  There have been some rather silly estimates that have been thrown out for the future.  I think they're trying to spur people to act.  Projecting that 3.3 millimeters out 3 or 4 decades in the future is probably pretty safe.  I suppose if you wanted to be conservative you could use 4 millimeters/year.  I suspect you'll find whatever real estate you're looking will be fine.

The exception to this is subsidence.  Some areas of the world have pumped enormous amounts of fresh water out of underground aquifers.  As a result, the aquifers are collapsing, and the ground is sinking at a rate that is much, much, much higher than sea level rise.  My particular part of Houston is down 6' in the past few decades.  You might do a little research into subsidence in your area.

Cheers.

Title: Re: Real estate purchases and climate change
Post by: fixie on November 04, 2019, 09:59:53 AM
Let the rich have the coasts.  The savvy elites are already making ready for what's coming.  If you are young, you may very well witness the abandonment of many cities on earth, massive dislocations of people(already underway in Central America, Northern Africa, Alaska) will exacerbate the problems and make solutions intractable.   Humans have never been around with CO2 levels this high or average global temperatures rising at this rate.  The relative habitability and stability of the Holocene has ended.

I am in the process of looking at properties with climate change, sea-level rise, forest fires, water availability, population density, farmability, and many other factors in mind.  Mustachianism, to me, is all about acquiring the resources now and deploying them as quickly as possible before the collapse.  When I find an interesting property, I go through a rather brutal checklist/research effort to see if it is the correct choice.  When considering sea level rise, obviously you don't want to live right on the water if you have kids and grandkids in mind.  King tides, storms etc. are increasing in intensity and frequency so even if you are "safe" from sea level rise you may still be affected.  Also consider the back-pressure of higher sea levels on major river systems.  That water will still flow, and it's got nowhere else to go but the floodplains surrounding the main channel.  These areas are also highly populated. 

All that being said, current projections using empirical data and climate models make earth basically unlivable for humans somewhere North of 2 degrees C.  When industrial society begins to collapse we'll have the aerosol masking effect to finish us off.  In other words, nearly half of the actual warming of the earth is masked by aerosols we pump into the atmosphere.  Cessation means rapid warming on the order of weeks to months.  So, do what you can, but also try to live a good life. 
-fixie
Title: Re: Real estate purchases and climate change
Post by: ColoradoTribe on November 04, 2019, 11:12:22 PM
Short answer is yes. While past purchases have not factored in climate change, all future sales and purchases will. More specifically, somewhere in the next 2 - 5 years, I will look to sell some current rental properties to purchase a rural retreat. While income generation on the rural retreat will be a key factor, a location that is climate resilient will guide the purchase decision. I'm thinking inland mid-atlantic. A property with a spring and/or well water, but not near an ocean or on a flood plain. A spot with good soil for growing and little to no fire danger.

I fully expect my 401k to become about worthless right around my retirement age if I do nothing. I'll try to hedge as I approach traditional retirement age in 2042 (FIRE'd 2 yrs ago) by moving to the most conservative options (money market accounts, CDs, etc.) within my retirement accounts and by employing early withdrawal strategies. As the poster above indicated though, best to shift assets towards a subsistence and self sustaining form of existence in advance of the dramatic changes that are already occurring and that will only accelerate in the years to come.

Title: Re: Real estate purchases and climate change
Post by: clarkfan1979 on November 05, 2019, 02:19:31 PM
I think climate change has a huge influence on vacation rentals in ski towns. The shorter the ski season the more vacancy. Buying ski condos at lower elevations with the chance of more rain than snow in the future seems risky. 
Title: Re: Real estate purchases and climate change
Post by: SndcxxJ on November 05, 2019, 09:07:58 PM
It depends on your holding timeline.  If you are inclined to buy property and still own it in 30+ years then this should be considered, as well as every other piece of information you can get your hands on.  I am very picky about the property I buy, I own it indefinitely, and I consider all risks.  I would advise the same.   I don't know how much credit to give maps like these, as they can't take into account all changes that will occur in society between now and then.  Ultimately, there will always good property to buy in good areas, though you might focus on certain neighborhoods more than others because of information like this.
Title: Re: Real estate purchases and climate change
Post by: SpreadsheetMan on November 06, 2019, 03:02:46 AM
Yes, I'm thinking about it. When I RE(-ish) the plan is to move to North Norfolk, but with the coastal erosion issues and the general low-lying nature of the county it's a real consideration in a much shorter timescale than 30 years. Fortunately there is a coastal ridge in the areas I am most interested in, so as long as I am well above sea-level up that it should be OK for as long as I need it to be.

The issue that is also concerning me is the move to reduce domestic carbon emissions, a high proportion of the area doesn't even have domestic gas (oil+wood is common) and the general old age of the housing stock means that a lot of properties will be very expensive to heat if gas/oil/wood heating is prohibited or massively taxed. (I know my current house - a 1930s semi, would increase utility bills by 2.5x if the heating had to be electrical assuming the efficiency was the same as gas heating)