The Nightmare Scenario for Florida’s Coastal Homeowners
bloomberg.com
bloomberg.com
No. No no no no no. Absolutely not.
Mr. Cason made a crap ton of money, spent millions of dollars "investing" in property which would soon become worthless and now he's blaming CONGRESS?
Mr. Cason. Sea rise isn't your fault, but buying a gorgeous, lavish beach house where it will no longer exist is your responsibility.
Congress should create a resilience fund for kids at school who have no food. Congress should make a resilience fund for veterans who can't work. Congress should make a resilience fund for folks bankrupt because of medical debt. But Congress need not send a bucket to the millionaires of Miami.
Postscript: not everyone who lives in Miami is a millionaire. I've hung out with very poor folks in Miami. That said, The first homes to go are going to be the ones owned by the elites on the water.
http://crooksandliars.com/news-hound-ellen/john-stossel-just...
We shouldn't hold individually rational (net benefit) decisions against someone's principles.
If you believe drugs should be legalised but you won't sell them in public are you a hypocrite?
You can want system change and also work within it as it exists.
Is it objectively mispriced? Probably. But we would have to have access to all of the premium received and payouts made by FEMA. https://www.fema.gov/use-flood-insurance-study-data-availabl...
This is the same thing, but just much slower. Tons of that coastal housing is new, the idea of rising sea levels is certainly not new, and we've seen this coming for a long time. This is basically choosing to drive your house into the sea, and then demanding a handout.
I do think we should subsidize moving buildings farther inland, or putting them on stilts like they did in the Rockaways post Sandy, but just straight buyout? Forget about it.
Myrtle Beach and Miami are just not as important as NIT (Norfolk) and Portland. And higher up the urgency ladder are places like Houston and New Orleans, that must be saved and held at any cost.
Same with bailing out areas that get wrecked by earthquakes or forest fires or any other natural disaster. Our natural inclination is to support people this happens to, and there is a positive in that we achieve a wealth transfer to people that just had a big hit in their well being, but if it becomes policy then going forward resources will be inefficiently allocated.
The somewhat depressing thing is we probably find ourselves bailing out people who (whether they knew it or not) were only engaged in the risky behavior that lead to them needing to be bailed out because of the social norm of the government bailing out people in that type of situation.
Part of the point of having civilization is as a kind of insurance. If you live in a once-in-every-two-hundred-years-massive-flood-plain, are you saying living there is risky and the government should not have emergency disaster relief?
Most of the coastal cities in the US including Manhattan, could be under water from global warming in the future. Are we saying that people who move to New York city should be aware of increased potential for damage from global warming?
And if they should be aware of these things, perhaps we should stop ignoring global warming in our political system. It'll be cheaper to mitigate it earlier, than way 50 years for flooding to massively increase.
It makes sense that the cost of living in dangerous places be built into the cost of living there, instead of being actually encouraged with free government money.
I do feel sorry for older, poorer communities that may have their homes and assets wiped out. To the extent they haven't already been replaced by newer, wealth-targeted construction. I hear it's increasingly difficult to even find an "old style" Florida community directly on the coast. About... 20 years ago (yikes!), I got to spend a couple of weeks in one that was in the process of having its beach front turned into high-rises. I understand that is complete, now.
"The quality of life for people everywhere will go down. There will be less food and less clean water available in the developed and the developing world. It's reasonable that this will lead to conflict: more violence, more war. Here in the super-developed US, people will have to abandon homes in Miami, Galveston, Norfolk, and other coastal towns. It will lead to defaulted mortgages and people looking for jobs inland. Where will those jobs come from? Sooner we get to work the better." [1]
[1] https://www.reddit.com/r/IAmA/comments/66ajul/i_am_bill_nye_...
popularly known as Bill Nye the Science Guy, is an American science educator, television presenter, and mechanical engineer. He is best known as the host of the PBS children's science show Bill Nye the Science Guy (1993–1998)."
https://en.wikipedia.org/wiki/Bill_Nye
Bill Nye is a media personality. Where he draws the line between 'presenting the facts' and 'entertaining the crowd' is hard to judge. Global warming disaster porn gets him exposure and helps his career. I would take any of his predictions with a grain of salt unless backed up by some serious research and studies. These claims by Nye and others are usually just intuitive guesses made by the presenter.
Honestly I'm surprised it's not worse and it seems to fall in line with a lot of worse-case predictions I've seen made in various studies.
Thank you for defining what speculation means. /s
What is "Global Warming Disaster Porn"? How about, "predictions about what may happen based on the scientific fact that global warming is a reality and may badly impact our current civilization, that may or may not come true"?
I'm not worried that the next tsunami will swamp it, or that it will be (physically) underwater in my lifetime, or that nothing will be done to prevent slow rise from swamping the land.
I'm just simply unwilling to make a 30 year commitment to today's value, when I don't know what we'll know in 30 years. It's an absolute certainty that we'll know more in 10 years than we know now. When will that property become un-sellable? When will the value start being impacted? I'd guess sooner rather than later, and if that isn't until 2040, that's still way too soon for comfort -- particularly if I'm trying to retire then.
But, yeah, I don't think I'd buy anything by the water either.
edit
So, I'm wrong, Northern California isn't far enough north. it's a real effect. You're all underestimating the mass of 100,000 cubic miles of ice.
[1] http://science.sciencemag.org/content/323/5915/753
[2] http://www.nature.com/nature/journal/v409/n6823/abs/4091026a... reply
Can you provide a reference or show some workings which demonstrate that statement to be true? I've not heard this before, and it's not obvious that it should be true.
http://harvardmagazine.com/2010/05/gravity-of-glacial-melt
Wikipedia eqitorial bulge has some info as well.
http://onlinelibrary.wiley.com/doi/10.1029/2012GL053000/full
Since Florida is near the equator, facing the same ocean as Greenland, and has subsiding land, it will likely experience more effects of sea level rise.
http://nautil.us/issue/33/attraction/why-our-intuition-about...
Uhh... Is this true? Doesn't seem right to me...
But the bit you quoted implies something more of a runaway effect. I'm pretty sure that won't happen - there's not enough mass in water compared to the total mass of the earth. In fact, I'm pretty sure that adding more water to the oceans will raise sea levels even at the poles, despite the rotation of the earth.
It's pretty easy to calculate the acceleration due to rotation at the equator. It's a = omega^2 x R, where omega is (2 pi) / (24 * 60 * 60) seconds = 7.27e-5 / seconds, and R is the radius of the earth = 6.371e6 meters. The acceleration due to rotation is then a = 0.0337 m/s^2. Compare with 9.8 m/s^2 for gravity. That's 0.3% of gravitational acceleration. That's... not very much.
However...wildfires.
And then there's the insurance issue- as insurance rates go up, the home value has to decline as well. Didn't seem like a good long-term investment, or even short term, as more and more people start considering these issues like I did.
The prices will drop way before they're under water.
We ended up buying a house in the hills - 900ft. up. I wonder if in 10 years folks in Alameda will start migrating our way.
I think he is right that its the banks who will start the decline by no longer issuing mortgages, starting with long term mortgages. We've already seen it happen in cities that don't have coastal flooding like Detroit.
People leave, property values fall, banks stop giving out as many loans, values fall further, property taxes revenue declines and the cycle repeats as the city circles the drain.
Ideally you'd have something like a forced relocation where the country/state/county would buy your property from you and you'd move, but with 100's of billions in property about to disappear, it's not really realistic let alone politically feasible for the government to buy everyone's ocean front property and put the bill on the shoulders of someone from Colorado.
I mean look at a city like New Orleans, its very easy to argue that it shouldn't have been rebuilt but it was politically impossible for someone to be the voice of reason and state that certain areas of the city be reclaimed and no longer available for residential construction.
And that's a relatively poor city, What's going to happen when billionaires island and South Beach starts to continually flood and then slowly start to disappear?
The only downside (according to the article) is that coastal cities would start to lose tax revenue. But, that problem seems much better than tons of people living on the coast that will eventually be consumed.
Nope. The banks don't care about the risk so long as you have insurance. They will continue to have insurance as long as we continue to subsidize them.
There's a risk that an owner will walk away from the mortgage on a house that has bad long-term value prospects. Other than pooling the risk of those mortgages against stable mortgages I'm not sure how a bank hedges against that scenario.
https://en.wikipedia.org/wiki/Citizens_Property_Insurance_Co...
http://www.rollingstone.com/politics/news/why-the-city-of-mi...
Banks have assets at risk for longer than the insurance coverage period. They have to be thinking longer term than insurers do.
But I see a prediction of 32 cm rise by 2050 on Wikipedia (1)
It doesn't seem like the Florida coast is going anywhere overnight. Is there a chance we're panicking?
"The National Oceanic and Atmospheric Administration predicts sea levels will rise as much as three feet in Miami by 2060."
3 feet is 91 cm so there seem to be different estimates than the one you have, unless the sea will rise two feet from 2050-2060.
- Worsening effects from storms.
- More serious, frequent, and lasting flooding.
- Destruction of subsurface fresh water (big, big problem in most of Florida, it's not on bedrock).
- Increasing difficulty in all subsurface infrastructure systems.
- Vegetation death due to above.
Just for starters. These are all probabilistic scenarios but the curves absolutely do matter, they are what feeds into insurance, predicted maintenancerequirements, QoL assessments and so forth, which in turn has a major effect on property values.
You should also remember the fact that property markets in particular have a predictive component as many people think longer term then they do elsewhere. Just because a problem is years down the line doesn't mean it won't start getting taken into account now, and that's particularly true with financing which matters since many property deals are heavily debt financed or leveraged. We're not even touching on politics here.
So there's quite a significant number of potential areas for negative feedback loops to kick into effect and end the party real fast, with the rational actions of every individual actor precipitates a readjustment that's much more rapid then you might expect otherwise.
The underground springs will become contaminated with salt water fairly easily.
The future is going to look like the article's story about Key Largo first. Flooded streets and other infrastructure for periods of days instead of hours. And that's definitely enough to drive educated buyers away.
I would have loved to live in a different area than where I bought my house, but I couldn't argue with the advantages that come with being over 30' above sea level. Already I'm not required to purchase flood insurance, which is a large savings every year.
I live in Virginia Beach, in what's officially not a flood zone, but Hurricane Matthew (which was pretty mild as things go) put our street 4 feet underwater and about a foot below our front door.
If our neighborhood gets redesignated as a flood zone, we'll lose a big chunk of our house value immediately and may not be able to sell it.
I'm definitely thinking that we need to move sooner rather than later as no matter if it's 32, 28, or 57 centimeters of sea level rise it's hard not to think we won't see more hurricanes, worse flooding, etc.
1 - https://www.nytimes.com/2017/04/18/magazine/when-rising-seas...
This is a really interesting perspective on the problem. If one of these three variables change dramatically it will feed back into the others. The average person may not try to predict their future home value 5-10 years out or have enough scientific background to understand climate science but an insurance company covering the area will have to consider both. It will be increasingly difficult for people to deny climate science as large number of homes and business properties lose value while at the same time their insurance rates dramatically increase. EDIT: a word
It's not about everyday sea levels. It's about what happens during storm surges.
Are people in general this head-in-the-sand or is it really that hard to grasp?
"The effects of climate-driven price drops could ripple across the economy, and eventually force the federal government to decide what is owed to people whose home values are ruined by climate change."
Nothing is owed to these people. The sea has always been a hazard. Ocean levels have always fluctuated. That doesn't change just because someone spends a bucket of money to build a house there.
- Estimates of climate change in the scientific literature tend to be conservative. Scientists often publish "at least" projections that lay readers might read as "up to". Especially if readers are consuming multiply digested-and-regurgitated versions of scientific reports (primary literature -> university press office -> Gizmodo).
- Considering average effects without accounting for extremes: e.g. visualizing "X centimeters of sea level rise by 2050" for a property near water without accounting for what that higher average level means during the worst storm of a decade.
- Thinking that you'll have enough warning before everyone else's irrational exuberance evaporates that you can go with the herd for the foreseeable future. With something as big as a home purchase, most Americans will sadly only get one chance to learn this lesson the hard way.
- I only need to worry about this if I live until the year 2100.
- After the year 2100 the trend lines will stop going up. If humans are ready for the effects of AGW in 2100, we're sorted away for the rest of history.
Ports are necessary to a nation for reasons of infrastructure and logistics that I won't go into right now. However, this is not to say that Miami or Myrtle Beach are as important as Houston or... say ... New Orleans. The reality is that there are certain ports that are more critical to the continuance of the US than others. And I'm hard pressed to think of two ports more critical to our survival than Houston and New Orleans. If those two were to disappear tomorrow, I'm pretty sure the rest of us would find out the hard way why they were important. (I'm not a petro-chemical engineer myself, but I was at Halliburton for a bit, and metallurgy alone to replace 5 or 6 trillion dollars worth of pipelines would be staggering.)
So given the criticality of certain ports... maybe there are people out there identifying the "ocean front property" that the US cannot live without... and buying it up where it is affordable? They wouldn't be so much gambling... as they would be seeing where resources will have to go... and getting there first.
Oceanfront, sure. Seafront, somewhat. Lakefront, not so much.
I expect most of them not only bought property, they voted to make a coal-supporting climate-change denier president....
I'm guessing you don't criticize people queueing up for properties in the Bay Area, where the Big One could happen any day, and while it will probably be in the East Bay, we really can't say for sure. And in that case, you don't just lose your basement, but possibly your life. In my opinion there are quite a few "heads in the sand," as you put it, on the west coast.
Your point about doing 'unwise things' because you have the money is well taken, and most waterfront property, like other highly depreciating assets, are a vanity thing, so I get that point well.
It doesn't surprise me at all that your "brilliant engineers" think climate change is a hoax and have bought waterfront property in a flood zone.
BTW, I'm an engineer (EE) myself, so I see this stuff in my colleagues (maybe not the terrorism stuff so much, but definitely the religion and conservatism).
For instance, you might have a scenario whereby Europe somehow has no climate change (this is demonstrably not the case), but, say, the 'stans become nigh on uninhabitable, or at least, bad enough that people don't want to stay put - you end up with a refugee crisis on your doorstep. This foments political change, economic change, and again, climate change is having an affect without directly affecting the local area.
Commensurately, you might find that your home insurance premiums on the gulf coast just keep on going up, and you decide to sell - except, the best you can get is less than you bought the place for, because new buyers are either building in the cost of insurance to the purchase price or don't exist, so you either don't sell, and end up staying until disaster really does strike, at which point you have nothing, or you relocate, writing off the worth of your property - which is where a great deal of people keep most of their net worth - and again, relocate, destitute. This creates pressure elsewhere on employment and housing markets, and before you know it, Iowa is saying that they want to implement immigration controls because the locals are up in arms, and political instability ensues. Meanwhile, your property on the gulf coast is still there, still standing, still not submerged, but the town's services have been gutted by the exodus, and the place is worth nothing - despite having not had any direct climate change impact.
Our society is a deeply unstable chaotic attractor - little nudges can cause massive disruption. Climate change is more of a shove, than a nudge.
In other words, suppose Iowa becomes a wasteland because of temperature changes. Other regions will become better suited for crops at the same time. Do we have reason to believe building the infrastructure for those lands to be suitable for agriculture would be more expensive than, say, moving the entire populations of Miami or Dhaka to someplace above sea level?
How many square miles of rural Iowa adds up to single square block of downtown Miami I'm not sure but the potential human toll is much more frightening. Displacing large amounts of people is of course deeply problematic. You need look no further than the situation we're in today with Syrian refugees for evidence of that. But in terms of turmoil, death and violence human displacements tend to pale in comparison to large scale disruptions of food production.
Unless, of course, your worst nightmare is a severe shortage of almonds. Yeah, they're likely to become an extreme luxury product.
https://www.bloomberg.com/news/articles/2017-03-08/only-sci-...
As FEMA redraws 100 year flood zones, even a few inches of increased depth will cause many "dry" areas to be recategorized.
Lots of South Florida floods every year, inland and coastal, and nobody sells their house just because it floods. If the boats can't make it under the bridge, they'll just put in locks; they've worked for a thousand years, so they can probably work for the Venice of America. And there are many cities throughout the world located near the ocean and under sea level.
The only risky part of South Florida real estate are giant condos in Miami, which have a habit of becoming empty. If you're a homeowner, though, your land will pretty much always have value until it is completely under water. Even then, they may just develop into Stiltsville 2.0.
Only a few areas of the US are affected. Florida has the worst problem. Florida is so flat. Look at an elevation map of Florida and the Gulf Coast.[1] The bright red areas will have to be evacuated.
The US west coast is mountainous; even where it looks flat, a few hundred feet inland is well above sea level. San Francisco and LA will build seawalls and berms as necessary.
And perhaps the Bay Area can also be saved with a levee at the Golden Gate bridge.
Maybe a dam near Novato to prevent salt-water incursion upstream.
If you think that problem sounds familiar it's because it is: It's exactly what caused the last financial collapse. Nothing has changed in terms of regulating the risks inherent in the "free market".
There is always this urge to DO SOMETHING. Pass a new law, bring in a new process, take a new pill, whatever. But those things also have costs, costs that are almost never analyzed and compared because they are "Free costs", e.g. we are protected in many ways from the costs because they are difficult to ascertain. If I don't take Lipitor and die of a heart attack, my doctor will say "see, there was a very visible cost." But if I take it for 30 years and find out that it causes memory loss and muscle problems and less efficient exercise adoption, none of that is measured (or possibly even possibly measured).
Fixing the climate is in a similar position. We need to do something because Miami will flood and people will default and the government may have to bail them out. But if we drastically reduce our carbon footprint, people will lose jobs, prices will be higher, standard of living will go down, etc. And none of that is discussed. Because it's hard and it might involve saying "It's best not to do something in this case." Which is hard for us to accept for some reason.
I'm not really sure where this leads, or why it's happening, but I do think it's worth noticing.
People hate change, and will fight to resist it, including fighting against the idea that change is necessary.
Except that some people, or rather some politicians, are denying that Y is even possible despite all evidence pointing that it does.
They also assume, without evidence, that X will be so high that it's not worth doing. Therefore, that justifies their public denial of Y being possible.
It should be possible to have a news article like this one without criticism that it doesn't deal with the large space of projections of future potential mitigations, their costs, and the costs of not doing anything.
As usual, starting with Wikipedia is a good place:
https://en.wikipedia.org/wiki/Climate_change_mitigation#Cost...
For example, the costs are estimated from -1% to 3.5%. For the US, the worst case cost is about the cost of our military budget.
I don't mind helping out areas impacted by tornados hurricanes etc but not ignorance.
With climate change things will never "get back to normal" so investing time and money into these places is unwise. It is better to tell people to move now before it's too late.
My idea to solve the problem is this: Legally prevent U.S. banks from granting loans to areas that are likely to become unlivable because of climate change in the next 30 years. That way when the problematic areas do become unlivable only foreign banks and rich folks that could purchase homes with cash will have to deal with the economic consequences of their poor decisions.
We as a society have externalized the costs of carbon emission. That cost is going to fall on someone, whether it's a person who couldn't have known or someone who should've known better it hardly seems reasonably to expect a small group of people to bear the blow.
Let them deal with the flooding on their own.
People, no matter their views, matter.
Tell me why I should have any sympathy for them, or why I should help them when their expensive homes get flooded.
* some people bought their homes 30+ years ago, when the timeline and exact impact wasn't known (and there was reporting of a potential Ice Age coming, despite that not accurately reflecting the science of the time)
* other people have bought since then, but have seen their own politicians telling them it's "in dispute", and the general media just says some people say it's in dispute and others say it isn't.
* our school systems do a terrible job of teaching fundamentals, like "what is a theory" to science.
Heck, while I believe in climate change and human-caused climate change, including the unprecedented scale, when I've tried to find good answers to skeptical questions...it's hard for the lay person to find. Things like "volcanos put out more CO2 in a year than mankind ever" are apparently false, but it's a lot easier to find that claim than the reverse (and much easier to find the refutation now than even 5 years ago). "Satellite data shows no global warming" is one I still don't quite follow - I get that they tend to pick a range from the last El Nino peak, but I don't know how to reconcile how they can say each successive year has been "the hottest on record" (including beating the previous year) but "satellite temperature measurements have been flat in recent years". If I - a reasonably well-educated person familiar with online research and with ample time on my hands - can't find decisive answers, how can I expect that everyone has?
Ultimately, I decide to trust in the overall body of scientists, but that's pretty subjective, and I can't fault the average person that understands science only from mass media for deciding NOT to trust the body of scientists.
See this from the article:
The National Flood Insurance Program is up for reauthorization this year; fiscal conservatives have said they want to use that opportunity to reduce the program’s subsidies, so that people are paying something closer to the full cost of their risk. A cut in federal subsidies would particularly hurt Florida, which despite its exposure pays the lowest average flood-insurance premiums in the country, according to FEMA data.
It would be disruptive to just yank out support for whole regions. But I feel like you shouldn't get to rebuild structures with government support unless the new ones are no longer vulnerable. Whatever gets rebuilt should be able to survive another event of the kind that destroyed it, plus a safety margin. That may mean that you just can't build the same kinds of structures all across the US. Depending on locale your home might need to survive earthquake, tornado, hurricane, whatever. It might mean that it looks weird and costs more. But being able to build "normal-looking" homes for "normal" prices is a terrible deal if it means that the rest of the country has to pay for reconstruction after nature predictably ruins them.
https://www.nytimes.com/2016/11/24/science/global-warming-co...