Ah, for a home within earshot of the crashing waves and easy access to the sand and tide pools! Many of us dream of buying property near the water. Since waterfront is limited and desirable, it generally just increases in value. Right?
But many people don’t realize that investing in waterfront property now may lose them money, in much the same way as splurging on an expensive car would: depreciation.
The reason? Rising sea levels are eroding the long-term value of such properties.
“Once impacts become noticeable, they’re going to be upon you quickly,” William V. Sweet, a scientist with the National Oceanic and Atmospheric Administration in Silver Spring, Maryland, told The New York Times a couple of years ago. “It’s not a hundred years off — it’s now.”
Sea levels are rising, according to scientists, due to global warming, as rising atmospheric and ocean temperatures melt polar ice caps and glaciers.
So, does that mean you will find your oceanfront property literally under water the next time you visit? Not this week or this month, but likely sooner than you’d think. And that means the property you counted on to appreciate in value — perhaps to fund your retirement or leave as a hefty legacy for your children — may be sunk.
In a way, the loss of millions of dollars in property may be the tip of the loss iceberg.
National Geographic reported that even “in the absence of something nasty” — think of an iceberg breaking loose and causing widespread havoc — rising oceans are poised to flood lush oceanfront homes.
Some good news is that these losses are still several years away, so there is time to sell. And demand is still high. Even a few months after Hurricane Sandy hit the East Coast in the fall of 2012, experts told Bloomberg that property values rebounded. And there’s no immediate end in sight to demand for waterfront property.
If you’re among those who think you’ll still buy a beachfront home and cash out before there’s a significant financial downturn, check back in with Money Talks News tomorrow for part two on this topic.
Does the impact of climate change affect your thinking about property investments? Share your thoughts in comments below or on our Facebook page.