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Water, Water, Everywhere…

Many of JMAC’s loans are within a few miles of the coast – fortunately well above sea level. Interestingly enough, the United States of America could become the next Atlantis. Now that I have your attention here is some facts according to Zillow.

If sea levels rise as much as climate scientists predict by the year 2100, almost 300 U.S. cities would lose at least half their homes, and 36 U.S. cities would be completely lost. On the other coast, in Florida where the highest elevation is about 350 feet, one in eight Florida homes would be underwater, accounting for nearly half of the lost housing value nationwide. And Zillow calculates that the median value of a home at risk of being underwater is $296,296. (The value of the average U.S. home is $187,000. This leads to hundreds of billions of dollars lost.)

Knowing about the problem helps move toward hopefully solving it, however. “Underwater” homes typically mean that they have negative equity, now homes actually being underwater poses almost as much of a problem for the future housing market as “underwater” homes (negative equity) has in the past. Nationwide, almost 1.9 million homes (or roughly 2 percent of all U.S. homes) – worth a combined $882 billion – are at risk of being underwater by 2100. 

Zillow used maps released by the National Oceanic and Atmospheric Administration showing which parts of coastal states will be underwater if sea levels rise by 6 feet. 6 feet seems like an awful lot to rise in 84 years considering ocean levels only rose 19 centimeters in the last century, but estimates say there will be a 6-foot rise if climate change continues unchecked. 

JMAC lends primarily in California, but 1 in 8 homes in Florida are in an area that is expected to be underwater if the 6-foot rise happens. When looked at from a city standpoint, Miami tops this list (although, I’m not sure Miami will mind, they’ll probably turn it into a giant pool party). While 2100 is a long way off, it is good to know early so it is possible that communities can take steps to mitigate these risks.