Believe it or not, there are still some folks who think climate change is a hoax. How many are financially invested in that belief, I don’t know. I do know that folks who are currently in the business of making money in the insurance industry *do* believe that climate change is real. They’re no longer willing to insure residential and commercial buildings in risky areas. This threatens to trigger an insurance crisis with major economic consequences in the next 15 years:“In the U.S., the most likely major economic disruption from climate change over the next few years might well be a collapse of the housing market in flood-prone and wildfire-prone states. Billion-dollar weather disasters — which cause about 76% of all weather-related damages — have
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Joel Eissenberg considers the following as important: climate change, housing markets, real estate insurance, US EConomics
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“In the U.S., the most likely major economic disruption from climate change over the next few years might well be a collapse of the housing market in flood-prone and wildfire-prone states. Billion-dollar weather disasters — which cause about 76% of all weather-related damages — have steadily increased in number and expense in recent years and would be even worse were it not for improved weather forecasts and better building codes. The recent increase in weather-disaster losses has brought on an insurance crisis — especially in Florida, Louisiana, California, and Texas — which threatens one of the bedrocks of the U.S. economy, the housing and real estate market.”
Many or most states, both coastal and inland, have real estate with unpriced climate risk and potential overvaluation in US housing markets.
“A 2023 study . . . drew attention to a massive real estate bubble in the U.S.: the vast number of properties whose purported value doesn’t account for the true costs of floods. The study estimated that across the U.S., residential properties are overvalued by a total of $121-$237 billion under current flood risks. This bubble will likely continue to grow as sea levels rise, storms dump heavier rains, and unwise risky development continues.
Likewise, U.S. properties at risk of wildfires are collectively overvalued by about $317 billion, according to David Burt, a financial guru who foresaw the 2008 subprime mortgage crisis. Insurers are already pulling out of the areas most at risk, threatening to make property ownership too expensive for millions and posing a serious threat to the economically critical real estate industry.”
For those who believe climate change is a hoax, this is a huge business opportunity! Demand for property insurance will increase as tree-hugging insurance companies duped by the fake news climatologists pull out. Into the vacuum can step the anti-climate change entrepreneurs, who will pick this low-hanging fruit and laugh their way to the bank, amirite?