Stepping Back: Plans for a Changing Coastline

The sea will claim billions in U.S. real estate by 2050, with devastating financial impacts. Can we be proactive enough to mitigate the damage?

What’s at Stake

Over 648,000 coastal properties, or about 4.4 million acres, will be at least partly below the high tide mark by 2050, according to a recent study by Climate Central. Most of these properties are in Florida, Louisiana, and Texas. These properties represent over $35 billion in taxable real estate. And vital infrastructure such as drinking water and sewage treatment plants is also at risk. Rising seas will be financially devastating for property owners, the agencies that insure them, and the coastal municipalities that rely on property taxes.

For years, the National Flood Insurance Program (NFIP) contributed to this problem by charging premiums below the market rate. That made building or buying properties in risky coastal areas financially attractive, but NFIP is broke. According to the Congressional Research Service, NFIP currently owes the federal government over $20 billion. As of September 30, 2022, NFIP’s ability to issue new insurance contracts will expire unless Congress decides to renew it.

Yet Americans are moving to coastal areas much faster than they are moving away. According to the Census Bureau, the largest net domestic migration gains in 2021 were in Florida (220,890) and Texas (170,307).

So how do we get people out of harm’s way and keep the nation from going bankrupt as entire communities are swallowed by the sea?

Knowledge is Power

A new website, Riskfactor.com, provides a flood risk score for any address. House shoppers can learn whether the house they’re eyeing will flood within the next 30 years, so they can avoid buying flood-prone properties. The real estate brokerage Redfin found clients who viewed the flood-risk score changed their shopping behavior. They went from viewing properties with an average risk score of 8.5 before they knew the flood risk to 3.9 after accessing risk data. Not surprisingly, extreme risk influenced shopping behaviors more than minor risk. See this story by Leslie Kaufman.

Planned Relocation

People can leave flooded areas in three ways. One is crisis mode once homes have been devastated. A second is market chaos, as foresighted people move inland. But this seems less likely given the surging popularity of Florida communities like Coral Gables. The third is a more strategic, proactive approach, in which the government coordinates the relocation of entire communities. This might sound expensive, but it is much less costly than letting the chips fall where they may.

Some American cities are already planning for large-scale relocation. Norfolk, Virginia, developed a long-term plan for its waterfront that states, “where facilities cannot be reasonably protected from the impacts of rising water, they should be relocated to higher ground.”

A report by the Innovation Network for Communities listed several essential lessons for coastal relocation:

1. A city’s community-engagement process for resilience planning should be designed for the emotional and social aspects of considering managed retreat.

2. A city’s assessment of its climate risks and vulnerabilities should expose, not hide, the potential implications for retreat.

3. Cities should reframe retreat as not just a loss of what is, but as part of a positive and inspiring vision for what can be for the city’s long-term development and success.

4. A city can help to normalize retreat by relocating essential public infrastructure and revising city rules that steer new development.

5. Consideration of retreat should include recognition of its potential impacts on economic and social disparities in the city.

Mandated moves are a political hot potato, and communities may resist relocation until disaster has struck. But by then, will there be federal money to bail out homeowners? Will people have to compete with their neighbors to find housing in other areas?

Perhaps if enough people called for a strategic approach, communities could work together to create new possibilities above the high-tide mark.