A Mystery: Miami Property Values Seem Immune to Climate Change Risk

There’s been a lot of news recently about the dire effects climate change can have on Miami, yet not only has the risk not been priced into real estate but values are rising. What’s up? Are climate change deniers that rich, or is something else going on? Is the risk seen as so far out as to be discounted to zero?

It’s flat here, there’s a lot of coastline, and a sea level rise of only a few feet would turn Coral Gables into New Venice. Even a foot and a half — which apparently has a decent change of happening in the next decade or three — would be very bad for Miami Beach, and also for much of South Florida in that it could impact water supplies and swamp power plants.

How then to explain why none of this is priced into the real estate market? Not only are house prices mostly going up after perhaps over-reacting to the the foreclosure crisis, but so too are waterfront land prices, as evidenced by this $100 million/acre sale of the last piece of undeveloped waterfront in downtown (total price for 1.25 acres was $125 million).

Yes, it could be a bubble. Yes, it could be the musical chairs phenomenon where the buyer thinks they can flip it, or develop it, before the music stops. Or it could be that the buyers watch too much Fox News, or have their own climate scientists.

I’d really like to know what’s going on here — if only because I (co)own a house. Any ideas?

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4 Responses to A Mystery: Miami Property Values Seem Immune to Climate Change Risk

  1. Peter says:

    The Fire Island Syndrome? Either: I’m so rich, I don’t care…or, “somebody will do something about it when it really gets serious.”

  2. Vic says:

    Well, I’ve been here since the early 70’s and know people who’ve been here far longer, and all of the land that was above water for recallable history down here STILL is above water. And by that I mean there has been no noticeable (if even measurable) rise is sea level for 40-60 years of known history.

    So it’s hardly surprising that a certain grain of salt must accompany the assertion that, “a foot and a half — which apparently has a decent change of happening in the next decade or three.” The issue is not whether a foot and a half would be harmful, but whether it’s remotely realistic. While the sea may be rising, and it may or may not be due to Man’s influence on the environment, it’ll be difficult to convince anyone that the dire media-hyped warnings that we’ll all be treading water in 20 years aren’t laughable.

    • Scientific research indicates sea levels worldwide have been rising at a rate of 0.14 inches (3.5 millimeters) per year since the early 1990s.

      National Geographic.

      That’s 1.4 inches /decade. Not surprising you don’t notice it.

      Then again I do hear claims that when it rains a lot the flooding is worse than it used to be on the Beach and certain low-lying areas of the county.

      Then, of course, there’s this:

      The most widely used projection is the Army Corps of Engineers’, which sees a three- to seven-inch rise in South Florida by 2030, and from nine to 24 inches by 2060. Those numbers are accepted by the four-county Southeast Florida Compact.

      Harold Wanless, a University of Miami geology professor who’s long studied climate change, envisions much worse — a rise of as much as two feet by 2048, three feet by 2063 and 4.1 to 6.6 feet by 2100.

      • Vic says:

        To be clear, I wasn’t disputing whether or not the sea HAS risen (I don’t actually know – besides what is said), I’m simply saying that neither I, nor anyone I know that’s been here for decades, has seen any real change.

        Whether it’s true factually or not, my point was it makes it hard for people to swallow “predictions” like “two feet by 2060.” That was in response to YOU wondering why nobody seems to care. Well, that’s why: they don’t see it in the past, so the future seems vague, if not counter-intuitive.

        I make no comment at all here as to whether there might actually BE Global Warming, and whether or not that GW might be anthropogenic in any critical sense.

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