Using a combination of climate change projections, elevation mapping, tidal gauge readings and property data, a new report concludes what many in the Tampa Bay region likely already suspected: that properties in this area are at growing risk of losing value because of sea level rise.
The case study report, done by consulting firm McKinsey, points to Pinellas, Citrus and Manatee counties as three of the nine Florida counties facing the greatest threat of property devaluation because of sea level rise by 2050. That’s because flooding, especially when it’s a frequent event rather than the byproduct of hurricanes, makes properties less attractive to buyers.
The other six counties were St. Johns, Lee, Palm Beach, Broward, Miami-Dade and Monroe.
"While the Florida residential real estate market remains robust today, climate risk poses a potential threat to asset prices," the report states. "A climate-related devaluation of property prices in Florida would cascade throughout the state economy, affecting government tax revenue, GDP, commercial development, and population growth."
Statewide, the report estimates from $10 billion to $30 billion of property devaluation by 2030, and $30 billion to $80 billion by 2050.
When he saw several local counties were identified as especially high-risk, Randy Deshazo, director of planning and research for the Tampa Bay Regional Planning Council, said he was not surprised “at all.”
“We’ve known for quite a long time that we’re one of the most vulnerable parts of the country to sea-level rise,” he said.
When it comes to how local governments can prepare for it, Deshazo said they’re considering everything from sea walls to raising roads and buildings to higher elevations.
Year 2050 may sound far away, but it’s also the endpoint for 30-year mortgages that are being initiated now. Which is why it’s important for homeowners to be armed with as much information about their properties’ flood risk as possible, experts say.
That’s the mission of the First Street Foundation, a New York-based nonprofit research group that did the calculations behind the property devaluation projections in the McKinsey study. McKinsey is an international consulting firm that is conducting nine case studies on how climate change affects people and businesses.
Matthew Eby, the executive director of First Street, said he’s concerned by the fact that well-funded real estate investors seem to have better access to flood-risk information than average people buying family homes. They are developing property-specific flood modeling that is expected to be released in June.
“What we’re looking to do is to democratize that information so the (real estate) market can function more efficiently, so people can make smart decisions with the right data. So you no longer have the haves and have-nots,” Eby said.
Currently, maps created by the Federal Emergency Management Agency are the standard tool for determining flood risk, but those don’t include sea level rise. First Street’s data will allow anyone to search an address and see the flood risk, plus will account for future adjustments due to climate change, the group said.
Unlike some other states, such as Texas, Florida law does not require that sellers disclose a property’s flood history when it’s purchased.
But in Pinellas, the county and the Pinellas Realtor Organization have partnered to create a fairly unique, voluntary program for local Realtors to at least tell home-buyers about a property’s flood risk, evacuation level and whether it requires flood insurance. There’s a standard brochure with fields for Realtors to fill out and an online portal where they can view maps, including a tab for sea level rise based on estimates by the Tampa Bay Climate Science Advisory Panel.
Participation in that program also helps get most county residents a discount on their flood insurance policies through the National Flood Insurance Program — taking off more than $25 million from premiums annually, said Pinellas floodplain administrator Lisa Foster. And classes for real estate professionals wanting to participate in the program have continued to be popular, even as the coronavirus pandemic forced them to happen via Zoom last week.
“We basically go in and we teach them about everything from different flood zones to storm surge, the difference between them, when flood insurance is required and when it’s recommended — which is always,” Foster said.
Pinellas is working on prevention efforts to mitigate sea-level rise’s harm on local property values, she said. The county is completing a vulnerability assessment that could help officials identify needed projects or reconfigure regulations, such as the minimum required elevation for buildings.
“We’re aware that sea-level rise is here, and it’s coming, and we are concerned about being proactive about it,” Foster said.
Times staff writer Zachary T. Sampson contributed to this report.