MIAMI BEACH, FL – SEPTEMBER 29: A bus plows through a flooded street that was caused by the combination of the lunar orbit which caused seasonal high tides and what many believe is the rising sea levels due to climate change on September 29, 2015 in Miami Beach, Florida. The City of Miami Beach is in the middle of a five-year, $400 million storm water pump program and other projects that city officials hope will keep the ocean waters from inundating the city as the oceans rise even more in the future. (Photo by Joe Raedle/Getty Images)
Flooding due to climate change-related sea level rising, the erosion of natural barriers and long-periods of rain pose substantial economic risks to Florida, particularly to the value of South Florida real estate, according to two new reports released last week.
Estimates based on past trends suggest that losses from flooding in Florida could devalue exposed homes by $30 billion to $80 billion, or about 15% to 35%, by 2050, according to a report from McKinsey Global Institute.
A separate report from the climate-risk analytics firm Jupiter Intelligence said the percentage of vulnerable oceanfront properties affected by extreme flooding will rise in Miami-Dade County from 5% in 2019 to 98% by 2050.
By 2050, annual flooding damage county-wide in Miami-Dade County is expected to roughly double, leading to shortages in affordable insurance coverage and real estate market instability, according to the Jupiter Intelligence report.
“Ignoring, or underestimating, the actual economic risk posed by moderate flooding is common to other geographies in the U.S. and around the world,” said Rich Sorkin, CEO of Jupiter in a statement. “Almost none of this risk is reflected in prices. Most of this dynamic is not yet understood, nor is it implemented into the decision-making of financial institutions.”
