Every Coastal Home Is Now a Stick of Dynamite
Wealthy homeowners will escape flooding. The middle class can’t.
The Langfords got out of Houston just in time. Only two months after Sara and her husband, Phillip, moved to Norfolk, Virginia, in June 2017, Hurricane Harvey struck, destroying their previous house and rendering Sara’s family homeless.
By comparison, Norfolk felt like paradise. In Larchmont, the neighborhood the Langfords fell in love with, young children scratched chalk doodles on the sidewalks, college students and senior citizens ran side by side on nature trails, and crepe myrtle trees popped pink along silent streets.
But as the couple toured the area, situated on the banks of a sluggish river that feeds into the Chesapeake Bay, they noticed something alarming about the homes they were seeing. “We were looking at one house close to the water, and [our real-estate agent] started talking about flood insurance,” Sara recalled to me. “I said, ‘Really? In this area?’” The houses were about half a mile from the river, but monthly flood-insurance premiums on the homes were $800 to $1,000—almost as much as their mortgage payment.
Driving down a waterfront street called Richmond Crescent, the Langfords noticed that every home had been elevated at least 10 feet off the ground, perched atop a giant frame of concrete. Flooding had never been an issue in decades past, but as the sea levels around Norfolk had risen, it had become far more common. Now some streets in Larchmont flood at least a dozen times a year at high tide, and the wrong combination of rain and wind threatens to turn the neighborhood into a labyrinth of impassable lakes and puddles. For Sara, whose family was still recovering from Harvey, the elevated homes were a deal breaker. “When I saw that, I was like, ‘Absolutely not,’” she told me. “I said, ‘We’re just not even considering the area anymore.’”
You can imagine each of the homes in Larchmont—and elsewhere along the coast—as a stick of dynamite with a very long fuse. When humans began to warm the Earth, we lit the fuse. Ever since then, a series of people have tossed the dynamite among them, each owner holding the stick for a while before passing the risk on to the next. Each of these owners knows that at some point, the dynamite is going to explode, but they can also see that there’s a lot of fuse left. As the fuse keeps burning, each new owner has a harder time finding someone to take the stick off their hands.
Norfolk and many coastal cities like it might be closer to exploding than many of their residents think. The payment term for a standard mortgage loan is 30 years, and the median length of homeownership is 13 years. Meanwhile, the lowest-lying parts of Norfolk are roughly five to 10 feet above sea level, and climate scientists believe that sea levels in the city could rise by as much as two feet before 2050. How many more times will the dynamite change hands before it blows up?
Although many people in the United States still think about climate change in the future tense or as something that happens in far-flung corners of the world, the warming planet is already altering where Americans live. Hurricanes are growing stronger, wiping out swaths of houses along the Gulf Coast each year. Wildfires now burn relentlessly in California, incinerating homes in mountainous areas and contaminating major cities with smoke for weeks at a time. Cities across the West are considering restricting housing development out of fear that they won’t have enough water for new arrivals. As these disasters continue, a new trend of displacement is emerging: Whether by choice or by necessity, tens of thousands of Americans, if not far more, are moving in response to climate change, churning through the housing market as they seek out safe and affordable shelter.
This displacement is at once profound and not very visible in the coastal housing market, where buyers and lenders are just beginning to digest the immense consequences of future sea-level rise. The value of all of the coastal real estate in the United States exceeds a trillion dollars, and a large portion of that value may vanish as buyers starts to shy away from homes most vulnerable to erosion and frequent flooding. As home values fall to reflect climate risk, wealthy homeowners and investors will dump their distressed assets and flee, while middle-class homeowners like the Langfords will be left to deal with climate catastrophes and costly mortgages. The resulting turmoil could reshape the Eastern Seaboard, threatening the growth of coastal cities such as Norfolk and potentially triggering a slow migration inland.
Climate-adaptation efforts tend to focus on preparing for and recovering from major disasters—how we can protect our communities from wildfires, or how we can help people rebuild after a hurricane destroys their home. The future of a city like Norfolk hinges on far more difficult questions: What should we do with the dynamite? Who should be responsible for getting rid of it, and for how long should people be allowed to keep passing it around? The coastal housing market is one of many places in the United States where homeowners, governments, and private actors are wrestling over how to answer those questions.
Consider who absorbs the damage when the dynamite erupts. Homeowners buy insurance to prepare for natural disasters such as hurricanes and floods, but they can’t protect themselves from the possibility that the value of their home will collapse as the market grows more worried about sea-level rise, leaving them stuck holding toxic assets. Thus, home sellers and real-estate agents in risky areas have every incentive to understate the danger that their properties face, which means that many buyers like the Langfords don’t know how vulnerable they are until it’s too late. Local governments also have an incentive to understate the danger, because they rely on new arrivals and new development to sustain their tax bases.
The federal government has opposite incentives. FEMA spends billions of dollars helping communities rebuild after flood disasters, and also oversees an authority that sells flood insurance in risky areas like Larchmont. Because the feds are on the hook to help these risky places, it behooves the government to send strong signals about climate risk, nudging people toward safer areas. The high flood-insurance premiums in Larchmont were one such signal, designed to scare away homeowners like the Langfords. Banks and insurance companies have similar motivations: Because they stand to lose enormous amounts of money if they underestimate climate risk, these parties have every reason to seek out more information about flood danger.
The result is a kind of silent argument between the various parties, a dispute over whether and when to give up the dynamite. The federal government and major insurers fret about climate risk; homeowners and local governments try to downplay those alarms for as long as they can by disguising risk or building projects to mitigate natural disasters.
We don’t know to what extent the housing market has started to respond to this risk, but there are early warning signs. For a long time, research showed that home values declined in the aftermath of major disaster events such as hurricanes but rebounded over the next few years as buyers forgot about the risk of calamity. Now a growing number of studies shows that buyers and lenders in coastal housing markets are starting to leave flood-prone areas even in the absence of any major flood. Home prices in the lowest-lying parts of Miami Beach no longer rise as fast as prices on higher ground, and banks in North Carolina have started to transfer more flood-prone mortgages off their balance sheets, selling them to Fannie Mae and Freddie Mac. One study estimates that floodplain housing in the United States is overvalued by as much as $34 billion.
Caught in the middle are homeowners like the Langfords, who have to interpret all of these economic signals through the lens of their own lives. The question of where to live is not just an economic one, and people often make irrational decisions about staying in their home or leaving it behind. Still, over time, the mounting signals about climate risk will force people to change their mind about where it’s safe or wise to live. The costly experience of living through a flood or the fearsome sight of elevated homes on a waterfront street can push people off their previous trajectory, leading them to move somewhere else.
The Langfords ended up buying a house two neighborhoods over, in a slightly blander area called Colonial Place. They chose a home that sat just outside the floodplain and didn’t require flood insurance. A few months after they moved in, however, they started to find that some blocks in their neighborhood became swamped with water after every heavy rain. In the days after a big storm, the estuary at the western edge of the neighborhood tended to spill over into the lowest-lying streets, cutting off one major thoroughfare and pooling around the tires of parked cars. In autumn, when there was a king tide, salt water sloshed through Colonial Place from the east. They had passed on one stick of dynamite only to find themselves holding another.
This article has been adapted from Jake Bittle’s forthcoming book, The Great Displacement: Climate Change and the Next American Migration.
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