How Will Global Warming Impact Real Estate Prices?
Today, a VC named Fred Wilson discussed 10 bold predictions for the next decade on his well-named blog, avc.com. He is the same guy who Paul Graham once begged to invest in Brian Chesky’s Airbnb, but famously declined, pre-Series A and then also in later rounds. However, he got a whole bunch of other investments right, such as Twitter, Zynga, Etsy, and Geocities.
The most interesting discussion: How Will Global Warming Impact Real Estate Prices?
Coastal Areas and Climate Change
Real estate located in coastal areas are most vulnerable to climate change and global warming. Rising sea levels and accelerated coastal erosion can destabilize neighborhoods and plots built along beaches or landfill. Severe weather storms and wildfires have already devastated some of the wealthiest homes in southern California.
How About Really Hot Places?
Some people might see turning up the AC as a solution to climate change. The Guardian predicts unique climate challenges from the early 2000s housing boom – hundreds of acres of new developments created more heat absorbing materials (roads and asphalt).
Still, there are many thriving cities that have regular experience temperatures higher than the United States – Singapore for example. As long as people stay indoors and air-conditioned, the impact should be less than coastal cities. Real estate investors in Vegas should opt closer to the Strip, especially with mass transit plans in place for the coming decade that will connect most resorts in underground or enclosed tunnels, hidden from the elements.
Where To Buy, Where To Avoid?
The most extreme might choose to avoid lower Manhattan – after all isn’t Battery Park built on land-fill? Residents of 2 Gold Street in Financial District might remember going weeks without electricity, plus the tragic death of a staff member trying to fix it. Houses along the Rockaways and flood zones of Brooklyn and Staten Island seem good to avoid. Long Island City is a yellow flag – it isn’t the most at risk, but it’s one of the most heavily developed luxury areas since the financial crisis.
As for safer areas, almost everywhere north of Broome Street seems safe in Manhattan and the Bronx, as is the non-coastal portion of Brooklyn and Queens.
In other metro areas: Los Angeles, New Orleans, and Miami seems to be among the biggest fear spots, especially with a heavy inventory of retirement condo supply vulnerable to flooding, extreme weather, and longer mosquito seasons.