For more than a decade, the impact of sea level rise and tidal flooding has been making waves on the real estate market of coastal New England, costing property owners in Boston an estimated $5.7 million in lost appreciation. That’s according to a report from First Street Foundation, a Brooklyn-based nonprofit that studies the impact of sea level rise and flooding. Researchers concluded that across Massachusetts and three other New England states, more than $400 million in “relative value” has evaporated.
“It’s probably going to become even worse over time if adaptation and other approaches aren’t taken to further stop it,” said Jeremy Porter, a professor at Columbia University and a statistical consultant for First Street. “We would expect to see more [losses] on the lots that are already experiencing it, but then we’d also see if adjacent lots start to also experience tidal flooding.”
Researchers say information about the impact of flooding on property values was already available for a fee — and used by banks and insurance companies — but now it’s open to the public.
Porter said his team looked at existing models for determining home values and added a variable for lost appreciation relative to comparable homes. The methodology has been implemented in several other areas but now in coastal New England, homeowners — and maybe more importantly, prospective homeowners — can look at how properties are being affected by climate change.
The Flood IQ database allows users to look up properties and get an estimate of how much greater the value would be if not for the environmental changes.
One extreme case: a three-decker on Marginal Street in East Boston, now valued at $374,000. First Street’s model estimates it would be worth nearly $800,000 were it not for flooding and sea level rise.
But not every property has such dramatic relative losses. In Dorchester, affected areas include Port Norfolk and low lying parts of Savin Hill, as well as Lower Mills. On Lawley Street in Port Norfolk, for example, one property’s losses are calculated at $3,728. But if the trend continues over the next 15 years, the impact on that property would rise to just over $8,000.
For an individual owner in a booming real estate market, a few thousand dollars may not even be noticeable considering how much property values have appreciated in recent years. And on the regional level, researchers say losses in coastal areas could be met with proportionate gains in non-coastal regions.
But that won’t work for every municipality, said First Street Executive Director Matthew Eby. He said the tool allows municipal officials to ask: “’What is the actual loss to the tax base? What solutions can we put in place to keep that from happening in the future?’”
The database includes 2.5 million coastal properties in Massachusetts, Maine, New Hampshire, and Rhode Island where “sea level rise has eroded $403.1 million in relative home values between 2005 and 2017.” The majority of those losses — $273.4 million — are in Massachusetts.
The five hardest-hit communities in Massachusetts are Salisbury - $35.9 million in relative losses; Barnstable - $16.4 million; Saugus - $13.9 million; Nahant - $10.1 million; Quincy - $8.5 million.
Apart from the direct impact of flooding on specific properties, the study also concludes that flooding in neighboring areas also has an impact on home values. For example, if a street in a certain neighborhood is prone to flooding, that could hurt the values of every home on the street, even if a particular home doesn’t experience flooding.
Jesse Keenan, a climate resiliency expert at Harvard’s Graduate School of Design, said that connecting the value of homes with the well-being of urban infrastructure is an important contribution to the field. “Your property doesn’t necessarily have to be immediately inundated with floodwater to feel the impact from climate change — from flooding and sea level rise,” Keenan said. “Just because you’re on high ground, you may not necessarily be safe.”