How to Buy a Home—When All You Can Think About Is Climate Change
While the idea that Millennials want to rent homes, not buy them, has been repeated ad nauseam, the fact is that homeownership is still very much a goal for many people in my generation and Gen Z. I’d love to welcome my golden years by gardening and writing book number four from the home that I own.
But here’s the problem: Let’s say I took out a 30-year mortgage next year, meaning it’d be paid off by 2050: My youngest nephew will be 32. “Grey’s Anatomy” will be in Season 46. I will be the age my parents are today. But that’s a very different 2050 than the one the Global Commission on Adaptation, a group of prominent political and business leaders aimed at managing the effects of climate change, are imagining: According to a report published earlier this year, by 2050 global agriculture yields are projected to drop 30 percent while demand increases 50 percent; five billion people will lack sufficient water access; and hundreds of millions living in urban coastal areas will be forced from their homes.
As my fellow Millennials and I come to terms with what the future is expected to look like as we age, it’s tough to reconcile what we want middle age to look like and what we’re hearing it will look like. (And tough is only putting it lightly.) How are we supposed to feel secure in laying claim to a piece of property when it may not even be habitable by the time we pay off the loan? Is homeownership even a good investment anymore? Is it better just to rent and let our landlords think about how their buildings directly affect and are affected by climate change?
According to Valerie Amor, a real estate broker and owner of Drawing Conclusions LLC, a sustainability-focused architecture firm in South Florida, homeownership is still a worthy goal—it just needs to be handled differently than before. That means not letting those “what ifs” keep you from making progress.
“I always say: Be prepared, not scared,” says Amor, who is also part of the New York City Mayor’s Office Climate Resiliency Design Guidelines Working Group. “If you’re going to say ‘this is more than I can handle,’ you’re not going to get anything done.”
Yes, buying a home in an uncertain future is scary, but that doesn’t mean you should stick your head in the sand. The best thing to do is think ahead and get a good idea of what you, your potential home, and a potential local community can handle.
Don’t know where to get started? We’re here to help: I consulted a number of experts to determine how best to go about buying a home in a time of climate change. Below, a series of starter questions every potential homeowner should ask as part of their due diligence.
What are the threats in this area?
Climate change is global and there are some things that everyone will have to deal with, like changing air quality and access to water and food. But many of the risks are localized. Those on the Eastern seaboard, in Eastern Texas, and in the Southeast all need to consider flood risks, winds, and stronger and more frequent hurricanes. In California, it’s flooding, too, but also continual damage from wildfires, and—along with the interior and Southwest—extreme heat, too. In Alaska, the fastest warming state in the country (at a rate of twice the global average), thawing permafrost is literally making land—and homes—disappear.
If your city or town has completed a climate vulnerability assessment, it will list all of the threats that your locality faces. It’s not a standardized document, but there are guidelines. There is also no comprehensive database to search for this information, but a Google search of your city name plus “climate vulnerability assessment” will likely turn up the report if it’s been completed. (Finding your city doesn’t have one? Write to your elected officials to request it.)
But know that even within these regions, the degree of damage and risks vary greatly, too. Climate change means that the old real estate adage “location, location, location” is more relevant now than ever:
“It could be one street to the other that makes a difference,” says Amor.
Does the city have a climate action plan?
So your desired hometown has assessed the risks and understand the threats it will face over the next 50 years, but do they have a plan to adapt and lessen its impact and/or recover if and when damage occurs?
Climate Action Plans (CAP) exist at the state (16 states have no CAP) and city levels. These are comprehensive roadmaps that outline the measures a municipality is taking to reduce carbon emissions. Bruce Riordan, director of the Climate Readiness Institute in Berkeley, California, notes that newer versions of these plans also build in a basic assessment of future and current threats, as well as the needed changes a city must make to prepare for these threats.
Riordan also suggests reviewing the county or city general plan. It’ll spell out the local government’s plans for development in the future and is a good on-the-ground indicator of what actions the city is taking to protect against climate change’s impacts.
How will the neighborhood fare if disaster hits?
It’s crucial to look beyond just your own home and consider the impact on the surrounding neighborhood. Your house may be elevated above the flood line, but what happens when you need to buy food, or have to go to the hospital?
Riordan gives the example of his own home in the Bay Area. His property is not at risk of flooding, but utilities and infrastructure that he depends on are. “My house would be dependent on things like wastewater treatment plants, and they’re right down at the Bay,” he says. “If that stops working, we’re in big trouble. Our plumbing will get backed up quickly.”
And what about transportation? Will mass transit be shut down? Will key roads that you take to work be flooded?
“The bottom line is: Is the city even paying attention to this?” says Riordan.
How is the community infrastructure?
You’ve found a city that’s adequately prepared for threats and pinpointed a neighborhood that won’t be crippled at the first sign of danger. But is the community prepared to deal with crises?
Riordan stresses the importance of looking for “neighborhood and community cohesion.” Research has shown that during events like heat waves or natural disasters, communities that are organized, where neighbors know each other, fair much better than those where people stay in their own bubble.
“You’re going to be dependent upon what happens to your neighbors,” he says.
How was the house constructed?
When it comes down to the specific home that you’re considering, there are a lot of things to look for. Most homes are “built to code,” meaning that they do what the municipality’s building code requires. But that no longer is enough:
“There is no way friggin’ way in hell you would find me buying a code-built home at this point,” says Craig Foley, a Realtor at LAER Realty Partners in Boston and the chair of the National Association of Realtors’ Sustainability Advisory Group. He points out that most building codes are way behind when it comes to climate change concerns: In South Florida, for example, code dictates that buildings in the Miami-Dade area must be able to withstand 190 mph wind gusts of three seconds. Hurricane Dorian hit the Bahamas with 220 mph gusts.
“We’re not even close,” says Amor.
Instead, he recommends high-performance homes designed to maintain their structural integrity as external threats like hurricanes intensify. These homes are constructed with strong materials (e.g. concrete, steel, glazed brick, or naturally decay-resistant lumber, like redwood or western red cedar) and provide nearly air-tight insulation from environmental factors like wind, rain, and heat. These homes tend to be more environmentally-friendly than their “built to code” counterparts, too. Their construction leads to more effective heating and cooling, reducing energy use in the home. Also, many incorporate renewable energy resources like solar panels, which provides homeowners an independent power source in the event something happens to the power grid.
What climate-related damage has the house sustained?
Many states have laws about what the seller must disclose during the home-buying process, including previous damages and repairs. But Foley suggests always closely inspecting a property yourself for signs of damage from any local threats to assess future risk. For example, if a home is in or near a flood zone, check for signs of water damage.
“If you see that there’s a line four inches up on the two-by-fours along the walls, there was definitely water.”
Signs of damage aren’t the only clues, either. Some may be more innocuous, like having all the storage in the basement elevated—a sign that the house floods.
Additionally, if a home has recent renovations like a new hardwood floor or cooling system, ask why they were replaced. While the seller may just have wanted to replace them, there’s a chance they could have been damaged in a prior flood and paid for by the insurance company. You can find out what types of insurance claims the property has generated in the past through a CLUE (Comprehensive Loss Underwriting Exchange) report.
What can be done to a home to make it more resilient and efficient?
Many of the experts I spoke to reiterated that most of the available housing stock are not high-performing homes. However, they say there are plenty of things you can do to a “built-to-code” property to not only make it more durable against climate threats in the future, but also minimize its carbon footprint now.
The best way to improve a home’s energy performance is to create a tight building envelope, insulating the conditioned parts of the home from those that are exposed to environmental factors. In most homes, this means upgrading the insulation, windows, and doors. While it may be very expensive to retrofit a home all at once, Amor suggests starting in just one room and then look to see if anything else can be done at the same time to avoid redundant costs. For example, if you’re planning to upgrade the insulation in your bathroom, use the open wall as an opportunity to also install a triple-paned window.
“Do something that improves your life in small ways without major investments, which I feel like a lot of people find overwhelming,” says Amor. “Do it one step at a time.”
What type of insurance will I need?
It’s not just the purchase price of your home that you have to consider, but also the cost of insurance. In March, Munich Re, the world’s largest reinsurance firm, issued a report that found that the costs of climate change-related damage and associated risks are growing too fast for insurance companies to cover, leading them to raise premiums. According to a Guardian piece on the report, experts say this pattern could cause premiums to become so expensive that most people won’t be able to afford them.
Additionally, homeowner’s insurance does not cover flooding. If you are in an at-risk area—which the Federal Emergency Management Agency defines as those with a one percent chance of being flooded in any year, within 100 years—you’re likely going to be legally required to purchase a separate policy (which can get pretty expensive). Certain mortgage lenders may also require homeowners in moderate- to low-risk areas to buy additional insurance. Keep in mind, the maps FEMA uses to define risk are based on historical data and don’t account for what’s expected to happen in 15 to 20 years. And even if you do have a solid insurance policy, if your property repeatedly floods, it’s not unheard of for a lender to just cancel the policy outright.
Homeowners in areas at risk of wildfires are seeing a similar situation. A regular homeowner’s insurance policy will cover fire damage, but increasingly, insurance companies are requiring homeowners to pay for additional coverage, and in some high-risk areas in California, they’ve stopped offering policies altogether. If you can’t get your home insured, the last resort is the FAIR plan, a state-mandated program for high-risk homes. It’s usually expensive and comes with limited coverage.
While this may be scary, just know that insurance is complicated (to say the least), very site-specific, and based on an older system. Things may change in the next 50 years. What you can do now is find an insurance agent who is an expert in your area and can talk about future threats. Together, you can find coverage that works for you.
Take a look at these questions anyone buying a house should ask, depending on the local risks where you’re buying. And remember, you can’t predict exactly when and where all the major, paradigm-shifting natural disasters will happen and how they will affect you—but you can take steps to be prepared, not petrified.