Left, Right or center...the facts are that it's HOT in many areas of the country. I'm not talking about the housing market, I'm talking literally, it's hot outside. I feel for my East Coast friends these past few weeks..and coming in hot this week to California is a Heat Dome. From Northern California to LA, inland temperatures are expected to exceed triple digits in many areas for July 4th weekend.
For those that have ever tried to sleep in 80+ degree weather without AC, you will recall...it isn't fun? Furthermore, the heat poses elevated wildfire risk, which could partly be why in two filings with the California State’s Department of Insurance on Thursday, State Farm disclosed it is seeking a 30% rate increase for homeowners, a 36% increase for condo owners and a 52% increase for renters.
No matter what side of the political divide, in my near forty years on this planet I have personally noticed local and global warming. With or without science, my experience is valid enough for me and has and will continue to influence where and how I invest in Real Estate. Even if you don't 'believe in it' the banks, insurers, builders, utility companies and municipalities sure do and the reality is that your bottom line will be impacted..'regardless.'
I've seen first hand how during the 2020 NorCal wildfire season and the 2021 Pacific Heat Dome (when temps reached 116 degrees) how people and pets flocked to the Oregon Coast for relief that was 30-40 degrees cooler. Guests were literally paying any asking price for an AirBnB.
Unlike other gradual climate changes, the discomfort from heat and fire occur instantaneously. It's dangerous, deadly and costly. As in increased electricity bill anyone?
In contrast, according to a Yahoo Climate series on how areas are and would be effected by climate change in the years to come ranked Oregon’s Curry County, which is located on the coast, as the top spot on the list of 10 safest places to live in the Pacific Northwest when it comes to climate change risks, and is rated as 20th safest county overall in the lower 48 states.
The Oregon Coast is ground zero for regions of the country that will in many ways become more inhabitable as temps rise, water dries and abundance of resources is more critical. That's not to say the Oregon Coast is not without risk, there is flooding, geological hazards and tsunami's to worry about, but comparatively the risks from fire, heat, hurricanes and tornadoes is pretty low.
The investment appeal of the Oregon Coast is usually centered around proximity, value and appreciation of natural splendor. Investors from CA,AZ,NV are often seeking a reprieve from the density and anxiety of urban living and the Oregon Coast offers ocean, rivers, lakes, dunes, mountains and outdoor activities year round to unplug (or plug in?). As many of the surrounding regions grapple with rising water, heat, population and traffic problems and tensions, those invested in the Oregon Coast will have a sanctuary from climate and its societal effects.
A recent Zillow survey showed that more than 4 out of 5 prospective home buyers consider climate risks as they shop. With most citing saying their major concern was flood risk, followed by wildfires, extreme temperatures, hurricanes and drought.
What about you? Does climate risk factor into your investment model? ...Yet?
