The next real estate crash could be caused by the weather, not Wall Street – here are the places that should be worried

Unlike other structures in the area, the miracle house – known as Sand Palace – was built in to withstand winds of up to 250 mph. Its owners, Russell King and Lebron Lackey, equipped the structure with raised pillars and removable walls that would come off in the event of a storm.

"We wanted to build it for the big one," said Lackey to the New York Times. "We just did not know that we would find the big problem so quickly."

Like home, Lackey is a bit of an anomaly. Although architects have developed in recent years methods of protection against floods and strong winds few are the owners who have adopted a these innovations. According to the US Census Bureau, about 8% of the 800,000 single-family homes built last year (about 64,000) were built with concrete frames – hurricane protection.

while the threat of disaster weighs heavily.

In July, the Union of Concern Scientists discovered that 300,000 coastal homes could be subject to chronic floods by 2045. By the end of of the century residential properties worth about $ 912 billion could be in danger. , or 2.4 million homes – the equivalent of all Los Angele and Houston combined dwellings

Buyers still like to live by the water

When Hurricane Sandy swept away the coasts of New York and New Jersey in 2012, whole communities were forced to rebuild. In the seven years since then, government-sponsored initiatives such as the US Army Corps of Engineers and NYC Build it Back have done a remarkable job in cleansing these communities – so remarkable, in fact, that many seem to have forgot the devastation.

In the aftermath of the storm, Sandy was at the forefront of buyers' concerns.

" They wanted details," said Christina DeCurtis, a Queens courier. "Should they take out flood insurance, how did [flooding] affect the common charges, or was there an badessment?"

Years later, these issues virtually disappeared. Property values ​​continued to rise according to national and national trends. The market is in vogue – and coastal homes are considered one of the main products.

More: The rise of the seas threatens the value of coastal real estate [1945]

This is true not only in Queens, but also in rich enclaves like the Hamptons.

"There is a waterfront in the Hamptons and everything in between," said Matt Breitenbach, a local real estate broker. In recent years, he said, buyers in the region have been shifting away from the old families of money to become "types of private equity firms in their late 30s" who attach 39 importance at location with respect to area. Rather than looking for the typical McMansion Hamptons, they are looking for Malibu-style beach houses – the better one is by the water, the better.

Breitenbach stated that the shoreline properties could go up to ten or twenty times more than the rest of Hamptons' real estate.

Michael Loccisano / Getty Images Damage Caused by Hurricane Sandy.

Many of these buyers are unaware. the fact that $ 3.6 billion of Southampton housing could be flooded by 2045, the second highest amount among the coastal communities of the United States. Miami Beach is the first with $ 6.5 billion of houses at risk, while Ocean City, New Jersey, ranked third.

There are coastal communities with the highest property values ​​at risk of flooding:

1. Miami Beach, Florida

2. Southampton, New York

3. Ocean City, New Jersey

4. Central Coast, California

5. San Jose, California

6. San Mateo, California

7. Miami, Florida

8. Long Beach, New Jersey

9. Upper Keys, Florida

10. Bradenton, Florida

Despite its urban location, Queens ranks in the top 25, with $ 1.2 billion in homes – more than 2 00 residences – which may be flooded by 2045. In the Rockaways and Howard Beach, many homes are flooded. always ridden at Sandy's, while the owners were fighting over insurance claims or trying to bear the cost of rebuilding.

But DeCurtis stated that locals have still not established a connection between the devastation of the past and the threat of future damage.

"This escaped us fairly quickly from the minds of people," she said. " People do not think about it so much that they are not really more likely."

The same is true for buyers of Hamptons, who might consider raising sea level., But will not let him inform their purchase.

"This is not not in an offer nor in order to dissuade them from buying a house," Breitenbach said. " If you want to be on the ocean, you want to be on the ocean." Who should worry about floods?

Two years ago, DeCurtis was working on a Long Island City complex that was building its ground-level power grid while standing directly on a flooded area.

" I remember thinking to myself that it probably should have been increased if something happened again," she said. But no requirement prepared the building for rising sea levels.

One year after Sandy, New York implemented a climate resilience plan including new building codes and 335 million of Improvements for the Manhattan Storm Defenses.The costs and guidelines are still being weighed.

As a result of Hurricane Michael, many are the ones who identified the need for similar improvements, although Florida building codes were updated in 2007 to include safe building features such as shatterproof windows, buttressed roofs and pillars. stable concrete, these regulations only applied to new construction located one and a half kilometers from the coast. This meant that coastal structures built slightly inland or built before 2007 were poorly equipped to withstand the storm.

According to Albert Slap, resident of Coastal Risk Consulting p most of the building codes " are retrograde" in terms of risk of flooding. Miami Beach, which has recently updated its code, requires buildings to be elevated more than seven feet above the flood line, he added.

Mark Wallheiser / Getty Images Hurricane Michael destroyed homes and businesses.

Many of Miami's existing structures will have to be demolished and rebuilt in accordance with the new rule. Over the next five to twenty years, Slap said, the entire park of city buildings will become more resilient and its market value could increase. until the rise in sea level threatens to overwhelm the entire community.

Although Miami can count on tourism revenues and taxes to finance its reconstruction, other cities are lucky. Slap said that he was particularly concerned for Savannah, Charleston, Annapolis and the Jersey Shore, which present a high risk of flooding, but fewer resources.

"To have completely devastated communities because we do not want to bite the bullet and impose more stringent construction code requirements does not serve us in the long run", said Lisa Lindsay, executive director of the non-profit Private Risk Management Association.

The climate bubble is the new real estate bubble

As in the real estate bubble prior to 2008, many buyers and sellers & # 39; I'm not aware that there is a problem.

" You really have to look for information [about flooding and sea level rise]," DeCurtis said. "This is not really a mistake in the mind of the consumer."

Even the flood maps of the Federal Emergency Management Agency (FEMA) do not give a complete picture.

] "If you take Hurricane Harvey, Hurricane Florence, and now Hurricane Michael, the people who relied on the flood maps FEMA's decision-making was tragically surprised by the storm surge and other types of floods, "Slap said.

Prior to Hurricane Michael, the owners of many damaged homes on the beach in Mexico Beach had learned that they did not need to Flood insurance. A study conducted in 2018 by the University of Bristol reveals that 41 million Americans are likely to be flooded by rivers, while 5 million Americans are only protected by a police force. 39; insurance.

As a broker, DeCurtis stated that it was not up to her to warn buyers against possible climate-related disasters.

"There is a probability that this will happen." . "We can not say that the sea level is guaranteed, so we must be very careful, we real estate professionals."

At least, said Lindsay, coastal communities should be able to rely on local leaders and insurance workers. There could even be a domino effect between the two: if insurance companies required homeowners to install a curtain or hurricane curtain, this could force governments to adopt stricter building codes.

But this could take years, leaving more time for hurricanes and other disasters to ravage coastal communities.

" The process will be long," said Slap. "Some areas and neighborhoods are going to collapse."