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Sea Level Rise and Home Prices: Evidence from Long Island

Author

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  • Justin Tyndall

    (University of Hawai‘i at Manoa Department of Economics, University of Hawai‘i Economic Research Organization)

Abstract

Global sea level rise is a known consequence of climate change. As predictions of sea level rise have grown in magnitude and certainty, coastal real estate assets face an increasing climate risk. I use a complete data set of repeated home sales from Long Island in New York State to estimate the appreciation discount caused by the threat of sea level rise. The repeat sale methodology allows for unobserved property characteristics to be controlled for. Between 2000 and 2017, I find that residential properties that were exposed to future sea level rise experienced annual price appreciation that was 0.8 percentage points below unexposed properties. I provide numerous robustness checks to confirm this result. I also find evidence of demand spillovers by estimating an appreciation premium for properties that are near the coast but are relatively safe from sea level rise.

Suggested Citation

  • Justin Tyndall, 2021. "Sea Level Rise and Home Prices: Evidence from Long Island," Working Papers 2021-2, University of Hawaii Economic Research Organization, University of Hawaii at Manoa.
    • Handle: RePEc:hae:wpaper:2021-2
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    Cited by:

    1. Alexandra Lefevre & Agnes Tourin, 2023. "Incorporating Climate Risk into Credit Risk Modeling: An Application in Housing Finance," FinTech, MDPI, vol. 2(3), pages 1-27, September.
    2. Giulia Guerri & Alfonso Crisci & Irene Cresci & Luca Congedo & Michele Munafò & Marco Morabito, 2022. "Residential Buildings’ Real Estate Values Linked to Summer Surface Thermal Anomaly Patterns and Urban Features: A Florence (Italy) Case Study," Sustainability, MDPI, vol. 14(14), pages 1-22, July.
    3. Nori Tarui & Seth Urbanski & Quang Loc Lam & Makena Coffman & Conrad Newfield, 2023. "Sea level rise risk interactions with coastal property values: a case study of O‘ahu, Hawai‘i," Climatic Change, Springer, vol. 176(9), pages 1-21, September.

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    More about this item

    Keywords

    Transportation; Safety; Health; Traffic Fatalities; Externalities;
    All these keywords.

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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