A task force made up of several federal agencies noted that the oceans surrounding the nation will continue to rise in height. As reported by ABC Action News, the task force predicts that the ocean height in Florida’s St. Petersburg area could rise more than 20 inches by 2050.
Hurricanes and tropical storms in the Sunshine State are normal. Property owners may need to consider preparing for flood prevention and water drainage. The costs of building seawalls, for example, may require factoring into a real estate transaction.
Assessing a property’s likelihood of floods
Researchers expect sea levels along the Treasure Coast to rise by 17 inches before 2040, as noted by the Palm Beach Post. Climate change has, however, inspired new industries that offer ratings for assessing a property’s risk of damage from flooding.
As reported by PBS NewsHour, investors may face fewer regrets when considering the effects of climate change and a location’s risk of floods. Lenders and insurers may also reduce their risk of loss by including climate issues in their due diligence process.
Negotiating a sale price based on potential flood damage
A study published in the Journal of Financial Economics notes that properties exposed to a rising sea level sell for about 7% lower than beachfront properties without exposure. Over time, however, the price differential may increase with changes in water line heights.
Changes in weather patterns and rising sea levels could alter a property’s boundary lines. Before finalizing a transaction, parties may wish to perform a survey so they may include costs of development to reduce climate risks. They may then negotiate a price based on the most recent evaluations and projections to reach a favorable closing.