Climate change could cause a spike in the value of property away from shorelines, as the threat of rising sea levels pushes property seekers to begin to buy ocean view properties that are at higher elevations, according to Bahamas Realty agent Monica Knowles.
Knowles said in a press statement that post-Hurricane Dorian, buyers are already changing the way they look at properties.
“We may be shifting back to the era in land values that our grandparents had,” Knowles said.
“Rather than having low-lying beachfront properties, more people will want to build high on a hill with a view of the sea.
“While beachfront will always be desirable for its sheer beauty, greater consideration is already being given to elevation and it could shift even more if sea levels continue to rise and the population decides little by little to move further inland. That could produce a major shift in values. The perfect property of the future will be ocean or water view with high elevation or a building method that involves lifting the structure to allow water to flow through.”
The statement quoted Inter-American Development Bank figures, explaining that Dorian damaged almost 9000 homes and cost the real estate sector more than $1 billion.
It added that with the continuing threat of sea level rise, the risk to properties in low-lying areas has never been greater.
“Identifying vulnerability is important and there are many related to climate change that must be considered,” said Knowles.
“The value of low-lying properties is going to change slowly over a period of time, as buyers become more aware of the impact of climate change. Insurability will also become increasingly important in property decisions.
“One thing people have to worry about is the cost of repairing and reconstructing damaged properties. We all prefer to spend money improving and upgrading our houses, not restoring them to previous conditions every so often. And with storms intensifying and happening more frequently, insurers in some markets internationally are beginning to raise insurance premium costs. That’s a risk to people in The Bahamas as well.”
Knowles said in many countries around the world, the move to higher ground has already begun. She explained that information from property data company Attom Data Solutions showed that in 2016, U.S. home sales in flood-prone areas shrank.
She added that data from climate research non-profit organization First Street Foundation revealed that housing values in New York, New Jersey and Connecticut fell by $6.7 billion from 2007 to 2012 due to the threats associated with sea level rise.
“This is the reality of the age we live in,” Knowles said.
“But with risk comes opportunity. There are mitigation strategies people can embrace like building on stilts and there are ways to adapt properties to the new threats. Climate change doesn’t have to be a death sentence for some vulnerable properties, but expert planning and careful consideration will be essential in preserving property values moving forward.”