U.S. property values will drop as wildfire risk escalates
Our planet’s rapidly changing climate is taking an increasingly heavy toll in various regions around the globe, due to phenomena such as floods, rising sea levels, droughts, wildfires, and other extreme weather events.
Now, a team of researchers led by the University of Utah has found that the values of property where these hazards are projected to worsen will also be significantly affected unless aggressive climate change mitigation actions are urgently undertaken.
The properties at risk of losing value include those located in forested areas exposed to increased wildfires and tree mortality caused by climate stresses and beetle infestation.
Adaptation and risk mitigation
“As a society, we have this tremendous capacity to deal with and minimize, adapt to and mitigate risk,” said lead author William Anderegg, the head of the Wilkes Center for Climate Science & Policy at Utah. “We have insurance policies, we have seat belts in cars and airbags.”
“All of these are to mitigate the risk of getting in a car accident or having a fire burn down your house. But fundamentally, all these tools to mitigate risk are predicated on knowing what the risks are and capturing how those risks might change.”
According to Anderegg, climate change is a huge “game changer” since we don’t know precisely where, when, or by how much it will elevate certain threats.
Focus of the study
However, this new study shows promise in clarifying how climate change may affect specific variables, such as property values.
“This is a really clear case of where we need cutting-edge science and tools to tell us what are the risks and how are they possibly or likely to change this century due to climate change. Climate change is going to drive wildfire and disturbance risks up and is already driving them up. Insurers leaving states like California really underscores that,” explained Anderegg.
The research was a collaboration with faculty from the College of Social and Behavioral Sciences including geographer Tim Collins and sociologist Sara Grineski.
What the researchers learned
The team found that property values exposed to climate-sensitive disturbances increase sharply in future climate scenarios, especially in existing high-risk regions of the western U.S., while novel exposure risks will also emerge in some currently lower-risk regions, such as the southeast and Great Lakes regions.
Sadly, the massive impact of climate change has already become clear last week in the tropical Hawaiian Islands, where the nation’s deadliest wildfire destroyed an entire city and killed over 100 people.
According to the scientists, most of the affected real estate is in the Southwest and California, where soaring values of public private property near publicly owned woodlands are currently colliding with escalating fire risks and declining forest health.
Climate action could help
Moreover, although this study deliberately avoided identifying specific areas at risk, even a causal glance at Western real estate can provide an idea of where the trouble spots are, such as valuable residential property from Northern Utah located in scenic locales that face wildfire risks, such as Emigration Canyon and Summit Park.
The researchers focused on three different phenomena impacting property values – wildfires, tree mortality from drought and other climate stresses, and tree mortality from insect infestation – and projected what would happen by mid-21st century and end of the century under opposing emission mitigation scenarios. The analysis revealed that emission-reduction strategies, if implemented effectively, could substantially curb exposure.
“We looked at two separate climate scenarios, one in which we don’t really do anything [to reduce emissions driving warming]—it’s just business as usual, and things get more dramatically worse—and one in which we implement mitigation more aggressively,” Collins explained. “What the results show is that under a scenario in which we actually try to mitigate emissions in a way that reduces impacts of climate change, you see substantially less property value at risk in the future.”
Billions in property value at stake
According to the experts, focusing only on privately owned lots one acre in size or larger reveals that about $4 billion in property is currently exposed each year to wildfire risks in the U.S. These values are projected to grow to $22 and $44 billion by 2049 and 2099, respectively, under the “do-nothing scenario.” However, if aggressive climate action is undertaken, the value of exposed property that could lose their market value tops out at only $11 billion.
“What’s interesting is that people are drawn to those environments because of the amenities associated with forest resources,” Collins said. “This is where you’re seeing the high value of these lands, like California – areas that are identified as wildland-urban interface – are some of the fastest growing landscapes in terms of residential development.”
Conservative estimates
These findings are ultimately conservative, since they don’t take into account anticipated growth in these at-risk areas.
“Under climate change, in the hot arid West, many people, as temperatures rise, are going to be increasingly drawn to these mountainous environments,” said Collins.
“We actually just hold constant current levels of development, and we look at what is the effect of climate change and increased forest disturbance in terms of placing current property values at risk in the future. It doesn’t even take into account the fact that more and more people are being drawn to these forest landscapes because of the amenities,” Collins concluded.
The study is published in the journal Environmental Research Letters.
—
By Andrei Ionescu, Earth.com Staff Writer
Check us out on EarthSnap, a free app brought to you by Eric Ralls and Earth.com.
