Uh, Duh: When Prospective Buyers Learn A Property's High Flood Risk, They Tend Not To Buy

[hatrack]

When told about risks from flooding, prospective homebuyers were less likely to make offers on vulnerable properties, according to new research from the real estate brokerage company Redfin, which says that a growing awareness of climate risk could stunt home prices in flood-prone areas.

“We now have definitive evidence that the risks posed by climate change are affecting where Americans choose to live,” Redfin’s chief economist Daryl Fairweather said in a statement. “As more house hunters become aware of climate risk, homes in endangered areas will likely receive fewer offers, causing home values to fall.”

For the study, which involved more than 17 million prospective homebuyers in the U.S., Redfin gave a subset of users access to flood risk scores for individual homes, including information on how climate change is worsening floods. The information had a discernible effect on users interested in high-risk properties. Among this group, buyers not given flood-risk information went on to bid on homes with an average risk score of 8.5 on a scale of 10, while buyers who were told about flood risks bid on properties with an average risk score of 3.9.



The study ran from October 2020 to January 2021 and was carried out in partnership with researchers from MIT, the University of Southern California, and the National Bureau of Economic Research. Flood-risk scores came from First Street Foundation, a nonprofit focused on climate risk. The research comes on the heels of a new analysis from Climate Central showing that, as sea levels rise, nearly 650,000 private coastal properties could slip below the tide line by mid-century. The at-risk properties account for 4.4 million acres of land, an area larger than Connecticut.

EDIT

https://e360.yale.edu/digest/flood-risk-homebuyers

[samnsara]

1. there were over 300 acres of forest next to my land that was just...

..put up for sale for 750K. CHEAP! But...its a flood plain..(thank god) so no housing development! A farmer bought it for his sheep to 'keep the government from buying it'.



The government is too smart to buy that land, buddy, but thanks for keeping homes from being built on it anyway.


baaaabaaaabaaa

[Fullduplexxx]

2. Apparently farming pays well

[jimfields33]

3. There are many places that I'm sure buyers stay away from

Midwest tornado alley, California earthquake San Andreas fault, Florida hurricane area. And now flooding.

[Phoenix61]

4. My city just bought out 21 homeowners.

The houses are in an area that occasionally flooded but since Hurricane Michael frequently flood. They anticipate buying several more and creating a retaining pond. Not sure if the money is from a state or federal source.