Coastal Real Estate Research Articles

Modeling the effect of shoreline change on real estate value

While significant global research has been dedicated to value estimation and its influencing factors, which are crucial for the real estate sector, a discernible gap exists in studies examining the long-term impact of shoreline modifications, especially those induced by upcoming coastal constructions, on coastal real estate values.The study was conducted in a coastal region of the Karasu district, Sakarya province. The COPREM-2D numerical model was used to predict shoreline change. A hedonic value model, rooted in semi-logarithmic regression, was developed, yielding value equations for residences, plots, and lands. By creating an integrated model in which the shoreline change numerical model and hedonic value numerical model work together, a value estimation application was made with the integrated model for a selected coastal real estate property. Findings indicate that a property valued at TL 155,994.57 in 2021 is projected to depreciate to TL 35,878.75 b y 2028 due to anticipated submersion from shoreline changes. The study underscores the negative value implications of properties nearing the shoreline and the positive value implications of those distancing from it.

Policy and market forces delay real estate price declines on the US coast

Despite increasing risks from sea-level rise (SLR) and storms, US coastal communities continue to attract relatively high-income residents, and coastal property values continue to rise. To understand this seeming paradox and explore policy responses, we develop the Coastal Home Ownership Model (C-HOM) and analyze the long-term evolution of coastal real estate markets. C-HOM incorporates changing physical attributes of the coast, economic values of these attributes, and dynamic risks associated with storms and flooding. Resident owners, renters, and non-resident investors jointly determine coastal property values and the policy choices that influence the physical evolution of the coast. In the coupled system, we find that subsidies for coastal management, such as beach nourishment, tax advantages for high-income property owners, and stable or increasing property values outside the coastal zone all dampen the effects of SLR on coastal property values. The effects, however, are temporary and only delay precipitous declines as total inundation approaches. By removing subsidies, prices would more accurately reflect risks from SLR but also trigger more coastal gentrification, as relatively high-income owners enter the market and self-finance nourishment. Our results suggest a policy tradeoff between slowing demographic transitions in coastal communities and allowing property markets to adjust smoothly to risks from climate change.

Dynamics and trends of drug dealing: a local labour system perspective

This study provides a dynamic analysis of illegal drug trafficking in the Italian region of Sardinia, using the Local Labour Systems (LLS, ISTAT) framework. Data from major regional newspapers (January 2017 - De-cember 2022) were validated through institutional reports. A multivariate biplot analysis reveals an increase in drug seizures and the Island's role as a hub for national and international drug trade, facilitated by local and traditional mafia organizations. Related crimes are also infiltrating the le-gal economy, particularly in the coastal real estate market. This study high-lights the urgent need for targeted institutional and community strategies to protect younger people, who are increasingly involved in trafficking.

Sea level rise risk interactions with coastal property values: a case study of O‘ahu, Hawai‘i

Climate change-induced sea level rise (SLR) will affect a range of coastal assets and prompt difficult decisions about coastal land use across the world. Several recent studies find that current and projected SLR is associated with relatively lower property values. We contribute to this growing body of research with a case study of O‘ahu, Hawai‘i, which is famed for its beaches as well as valuable coastal real estate. We leverage a dataset that unpacks multiple types of SLR exposure and coastal parcel attributes. We apply property transaction data for the island of O‘ahu through 2019 to investigate the effect of current and expected SLR exposure on residential property prices. We find that exposed properties have already experienced declines in transaction prices, at 9 to 14%, attributed to expectations of exposure to chronic inundation (as opposed to seasonal flooding). The price declines are mainly for multi-dwelling homes as opposed to single family homes. The market response of residential properties to SLR has important implications for coastal management strategies, in particular the viability and timing of programs for retreat.

On the Geographic Balance of Risk and Amenity: Changes in Evacuation Zones and Their Ripples in Housing Prices in Pinellas County, FL

This study considers the balance of amenities and coastal hazards on housing prices between 2000 and 2015. We test whether risk communication via hurricane evacuation zone (a proxy for storm-surge risk and coastal flooding) affects sales price while controlling for relevant property characteristics, beach frontage, flood zones, and proximity to the coast. Additionally, we employ a difference-in-difference technique to test whether two highly publicized updates to evacuation zone maps, which changed the status of many homes in the county, led to price penalties for homes. We focus our study on areas of the new evacuation zone maps that reclassified parcels into zones associated with higher coastal surge exposure. This approach allows us to isolate the effects of risk communication about a property independent of changes to its insurance premiums or actual hazard exposure. We find that amenities are associated with significant bonuses and hazard variables correlated with price penalties, and homes in areas reclassified “up” in hazard zone classification have lost value. Our findings shed light on how information changes about hazards may affect coastal real estate markets as concerns about coastal hazards and exposure to storm-related surges increase along with climate change.

Impact of the Reduction of VAT Rate on Southeast Coastal Real Estate Enterprises

This paper takes the southeast coastal real estate listed enterprises that have been at the forefront of China’s reform for many years as the research object. Through theoretical analysis and descriptive statistical analysis, it studies the impact of the reduction of VAT (value-added tax) rate in 2019 on the southeast coastal listed real estate enterprises from the perspectives of sales revenue, costs, tax burden, profit, and cash flow. The overall operating tax rate has shown a volatile downward trend; the average operating income level has shown a volatile upward trend; the purchase cost has decreased slightly and the change was not significant; the total profits of enterprises have shown a cyclical upward trend. Due to the impact of the real estate purchase restriction policy and financing environment in recent years, the reduction of tax rate has an effective but not significant impact on the enterprise cash flow. Overall, the tax rate reduction still has a positive impact on enterprises. Combined with the problems in the process of policy implementation, this paper puts forward that those enterprises should make scientific and reasonable tax planning, pay attention to the management of purchase and sales contracts and the mode of cooperation with upstream enterprises, regulate taxation to reduce tax-related risks, improve the management level of enterprises, and establish an industry finance integration system. At the national policy level, there is limited room and effect for the reduction of the VAT rate, and more preferential tax relief policies should be given directly, not limited to VAT, but can be extended to corporate income tax. In this way, that could improve the effectiveness of the tax reduction policy in the southeast coastal real estate industry and provide a reference for relevant industries in other regions to solve similar problems.

Hurricane Matthew in 2100: effects of extreme sea level rise scenarios on a highly valued coastal area (Palm Beach, FL, USA)

Sea-level rise represents a severe hazard for populations living within low-elevation coastal zones and is already largely affecting coastal communities worldwide. As sea level continues to rise following unabated greenhouse gas emissions, the exposure of coastal communities to inundation and erosion will increase exponentially. These impacts will be further magnified under extreme storm conditions. In this paper, we focus on one of the most valuable coastal real estate markets globally (Palm Beach, FL). We use XBeach, an open-source hydro and morphodynamic model, to assess the impact of a major tropical cyclone (Hurricane Matthew, 2016) under three different sea-level scenarios. The first scenario (modern sea level) serves as a baseline against which other model runs are evaluated. The other two runs use different 2100 sea-level projections, localized to the study site: (i) IPCC RCP 8.5 (0.83 m by 2100) and (ii) same as (i), but including enhanced Antarctic ice loss (1.62 m by 2100). Our results show that the effective doubling of future sea level under heightened Antarctic ice loss amplifies flow velocity and wave height, leading to a 46% increase in eroded beach volume and the overtopping of coastal protection structures. This further exacerbates the vulnerability of coastal properties on the island, leading to significant increases in parcel inundation.

From Commons to Capital: The Creative Destruction of Coastal Real Estate, Environments, and Communities in the US South

Dans les décennies qui ont suivi la Seconde Guerre mondiale, l’aménagement des littoraux et des zones riveraines dans le Sud des États-Unis a connu une forte accélération. Si les études existantes ont bien identifié le rôle du tourisme et de l’économie des loisirs dans la transformation économique de la Sunbelt dans l’après-guerre, la question des effets sociaux et environnementaux de l’aménagement des littoraux demeure négligée. À travers le cas de l’île de Daufuskie, une île barrière située sur la côte de la Caroline du Sud, cet article met au jour les liens qui existent entre l’accumulation capitaliste de profits, l’injustice raciale et les dommages environnementaux – combinaison qui est à la source du Sud moderne. Ce faisant, l’article met en lumière le rôle des gouvernements locaux dans la mise en place des aspects les plus prédateurs et non-soutenables du capitalisme foncier. Il montre comment, dans des marchés immobiliers en pleine expansion, les pouvoirs locaux de taxation et de recouvrement de l’impôt peuvent devenir des outils d’ « accumulation par la dépossession » qui mettent à mal les modes d’utilisation et d’échange de la terre hors du marché, et forcent l’intégration de populations locales à une économie saisonnière fondée sur des emplois mal rémunérés.

Development of coasts: socio-ecologic-economic specifics

Preferential settlement along the coasts of water bodies (rivers, lakes, seas), dictated by a variety of production and recreational factors, has always been accompanied by environmental disruptions. A specific complex of social, environmental and economic problems arose with the beginning of mass cottage development of Russian coasts. At the same time, certain environmental risks were ignored. Until that time, the country had strict restrictions on the approach of dwellings to water and the operational regimes of households in the water protection zone. Particularly strict regulation for construction and operation of dwellings existed for the coasts of sources of communal water supply to cities and rural settlements and in resort and recreation zones. Today, coastal development is in many ways a chaotic process, accompanied by a wide range of legal and environmental violations. A critical situation developed on the sources of water supply in Moscow, at water supply facilities in other cities of the Russian Federation, on the sea coasts of the Krasnodar Krai and Crimea. Residents of prestigious coastal settlements form a large social group with a specific mentality. Very often it is based on a persistent desire to ignore environmental-legal imperatives for the sake of possessing expensive real estate and elitist recreation conditions. The methodology for study of the situation, based on the general principles of systemic analysis of socio-environmental-economic processes, makes it possible to significantly bring the economic interests of the social group in question closer to environmental and state interests. There is proposed a concept of improving the situation through proof of the inevitable depreciation of coastal real estate due to environmental degradation of water bodies on the banks of which unregulated development is conducted. At the same time, both the deterioration of the recreational climate up to a complete discomfort and the immediate economic losses of the population expressed by drop in the price of land and households in the real estate market, are equally important factors of depreciation.

Housing Market Value Impairment from Future Sea-level Rise Inundation

Sea level rise will pose increased risks to U.S. coastal real estate markets in the coming decades, though the direct economic costs depend on the severity and uncertainty within climate-change scenarios.

Real Estate Sector in the Face of Climate Change Adaptation in Major Polish Cities

Abstract This paper aims to review subject-matter literature and analyse the development policy documents of major Polish cities addressing the issue of climate change adaptation (urban adaptation plans, Polish abbr. MPA) and concerning the real estate sector; it is also an attempt to draw conclusions and identify potential benefits and challenges that the construction sector is currently facing. The literature focuses on coastal real estate, costs, benefits and barriers in the adaptation of buildings. MPAs point to the significant role of the real estate sector in adapting to climate change. Soft and hard instruments are becoming increasingly important in MPA. These are spatial planning (building restrictions in hazardous areas, use of green roofs in investments), a system of incentives for investors to promote adaptation activities, ecological education, investments in improving the energy efficiency of buildings. Also identified are the benefits to the real estate sector, e.g. the growing importance of occupations on the real estate market, the development of innovations and increased access to cheaper services and technologies. In Polish cities, high-intensity residential areas are characterized by high sensitivity. MPAs will strengthen the resilience of the city’s technical infrastructure and public space, as well as develop blue and green infrastructure, which may translate into the increased resilience of real estate.

An integrated model of real estate market responses to coastal flooding

AbstractUnderstanding and improving how humans adapt to climate change are priorities in our research community, and coastal settlements are good places to study adaptation. Severe storm events and sea‐level rise are threatening coastal communities with increasing levels of flood damage. Because ownership of coastal assets is distributed among many private and public actors, both individual property owners and public officials must take adaptive actions. This paper introduces an integrated agent‐based and hedonic pricing modeling system to simulate coastal real estate market performance under non‐equilibrium conditions that reflect the effects of storm events. The modeling system, which is used for policy analysis, is calibrated to conditions in two towns in Monmouth County, New Jersey, USA, which were badly damaged by Hurricane Sandy in 2012. The key findings are that (a) coastal real estate markets capitalize flood risk into property values but this discount diminishes rapidly as time passes between storm events, and (b) there is a distinct equity versus efficiency tradeoff in designing public policies to reduce the cost to society of coastal flooding. Stringent regulation of building practices reduces flood damage but drives away poorer home buyers and owners, whereas informational and incentive‐based policies are fairer but less effective. Hands‐off, market‐based retreat from risky areas is socially costly but allows less wealthy people to remain at the shore, albeit in vulnerable situations. Managed retreat should emphasize improved recreational access to coastal amenities while discouraging people from living there.

Are Some Natural Amenities as Good as Gold? Evidence from Coastal Real Estate and Marshlands

Hedonic property price models are commonly used to assess the value of environmental amenities for housing buyers. The underlying theory presumes equilibrium in the housing market. Housing markets, however, are prone to cyclical and shock dynamics, as evidenced by the recent Great Recession. Building on recent research, we explore capitalization of natural amenities in residential housing markets that are experiencing a significant economic downturn. There are a number of possible economic changes arising from housing market dynamics, providing basis for an empirical exploration. During economic distress, people often shift their portfolios toward safe investments, providing potential for housing market segmentation and amenity-value appreciation. Using a battery of regression models, we find evidence in support of these hypotheses with regard to proximity to saltwater marshlands around Savannah, Georgia. In doing so, we provide guidance on how to analyze hedonic property prices in the presence of market disequilibrium.

“Living on the edge”: Estimating the economic cost of sea level rise on coastal real estate in the Tampa Bay region, Florida

Climate change and especially sea level rise are posing unprecedented pressure on coastal communities through enhanced coastal flooding and saltwater intrusion. Thus, adapting to its impacts has drawn global attention. Since the cost-efficiency of adaptation alternatives is crucial in decision making, accurately estimating the economic cost of sea level rise is an imperative task for coastal planners and managers. This study employed a spatial hedonic approach to estimate the economic cost due to inundation by future sea level rise. The applied methodology provides better estimates of the economic losses due to sea level rise by accounting for lost coastal amenities, and the results generated can also be utilized for cost-benefit analysis. In 2050, it is estimated that the inundation of 3-foot sea level rise could cost Hillsborough and Pinellas County over 300 and 900 million dollars respectively for the real estate market alone. Local coastal planners and managers may find this methodology useful in estimating the potential economic cost due to sea level rise and support making adaptation decisions. We also stressed the importance of such studies to support local decision making and enhance adaptation planning for the climate change and sea level rise in the coastal communities.

Climate adaptation and policy-induced inflation of coastal property value.

Human population density in the coastal zone and potential impacts of climate change underscore a growing conflict between coastal development and an encroaching shoreline. Rising sea-levels and increased storminess threaten to accelerate coastal erosion, while growing demand for coastal real estate encourages more spending to hold back the sea in spite of the shrinking federal budget for beach nourishment. As climatic drivers and federal policies for beach nourishment change, the evolution of coastline mitigation and property values is uncertain. We develop an empirically grounded, stochastic dynamic model coupling coastal property markets and shoreline evolution, including beach nourishment, and show that a large share of coastal property value reflects capitalized erosion control. The model is parameterized for coastal properties and physical forcing in North Carolina, U.S.A. and we conduct sensitivity analyses using property values spanning a wide range of sandy coastlines along the U.S. East Coast. The model shows that a sudden removal of federal nourishment subsidies, as has been proposed, could trigger a dramatic downward adjustment in coastal real estate, analogous to the bursting of a bubble. We find that the policy-induced inflation of property value grows with increased erosion from sea level rise or increased storminess, but the effect of background erosion is larger due to human behavioral feedbacks. Our results suggest that if nourishment is not a long-run strategy to manage eroding coastlines, a gradual removal is more likely to smooth the transition to more climate-resilient coastal communities.

Modeling Real Estate Market Responses to Climate Change in the Coastal Zone

Changing flood risks threaten the value of billions of dollars worth of coastal real estate as well as the viability of coastal communities. This paper presents an agent-based model to capture some of the main features of the housing market that emerges from interactions between autonomous buyers and sellers. We use this model to investigate the adaptive responses of real estate markets to changing patterns of flooding and alternative flood insurance policies. The model includes interactions among households and government through land use regulations, property tax collection and dissemination of flooding risk information. We use detailed data from a flood-prone coastal community in New Jersey, USA to calibrate our model.

A coupled physical and economic model of the response of coastal real estate to climate risk

A study that couples a barrier-island model with an agent-based model of real-estate markets shows that, relative to people with little belief in model predictions on climate change, informed property owners invest heavily in defensive measures in the short term. They then abandon coastal real estate when price volatility becomes significant. Barring an unprecedented large-scale effort to raise island elevation, barrier-island communities common along the US East Coast are likely to eventually face inundation of the existing built environment1 on a timescale that depends on uncertain climatic forcing. Between the present and when a combination of sea-level rise and erosion renders these areas uninhabitable, communities must choose levels of defensive expenditures to reduce risks and individual residents must assess whether and when risk levels are unacceptably high to justify investment in housing. We model the dynamics of coastal adaptation as the interplay of underlying climatic risks, collective actions to mitigate those risks, and individual risk assessments based on beliefs in model predictions and processing of past climate events. Efforts linking physical and behavioural models to explore shoreline dynamics2,3,4 have not yet brought together this set of essential factors. We couple a barrier-island model with an agent-based model of real-estate markets5 to show that, relative to people with low belief in model predictions about climate change, informed property owners invest heavily in defensive expenditures in the near term and then abandon coastal real estate at some critical risk threshold that presages a period of significant price volatility.

MEASURING THE IMPACT OF SEA-LEVEL RISE ON COASTAL REAL ESTATE: A HEDONIC PROPERTY MODEL APPROACH*

This study estimates the impact of sea-level rise on coastal real estate in North Carolina using a unique integration of geospatial and hedonic property data. With rates of sea- level rise approximately double the global average, North Carolina has one of the most vulnerable coastlines in the United States. A range of modest sea-level rise scenarios based on the IPCC Fourth Assessment Report projections (2007) are considered for four counties of North Carolina—New Hanover, Dare, Carteret, and Bertie—which represent a cross-section of the state’s coastline in geographical distribution and economic development. High-resolution topographic LIDAR (light detection and ranging) data are used to provide accurate inundation maps for the properties that will be at risk under six different sea-level rise scenarios. A simulation approach based on spatial hedonic models is used to provide consistent estimates of the property value losses. Considering just four coastal counties in North Carolina, the value of residential property loss without discounting in 2030 (2080) is estimated to be about $179 ($526) million for the mid-range sea-level rise scenarios. Low-lying and heavily developed areas in the northern coastline are comparatively more vulnerable to the effect of sea-level rise than the other areas.

Uninterrupted Views: Real-Estate Advertising and Changing Perspectives on Coastal Property in New Zealand

This paper considers the landscape of coastal property in New Zealand through the lens of real-estate advertising. In analyzing a sample of 236 newspaper advertisements, it connects representations of coastal housing to broader concerns about the development of the coastline. Much public anxiety centres on the notion that coastal residential development and escalating property values signal private gain, but public loss. What is lost, it is claimed, is a landscape that is open, physically but also socially: the presence of imposing holiday homes detracts from the experience of going to the beach, and contributes to the unaffordability of staying at the beach. Such notions do not, of course, feature prominently in advertising. We find that views from private property over the coast are often prioritized in advertising, while the coast itself is typically portrayed as devoid of people. This invites viewers to place themselves in the image—as prospective property owners—and appeals to notions of going to the coast to secure privacy and opportunities for passive relaxation. Advertising for coastal real estate, we conclude, promotes a way of seeing the coastal landscape that is consistent with the ideology of enclosure.

Population genetics of the mangrove salt marsh snake, Nerodia clarkii compressicauda, in a linear, fragmented habitat

The mangrove salt marsh snake (Nerodia clarkii compressicauda) occupies a unique and disappearing habitat in much of coastal southern Florida. Given extensive habitat fragmentation and high predation pressure in open spaces, it seems likely that populations of N. c. compressicauda consist of isolated groups of related individuals. To assess the degree of population subdivision in this species we genotyped a total of 125 individuals from seven locations along the Florida coast at four microsatellite loci. Overall heterozygosity was moderate (57.7%) and somewhat lower than that seen in other snake species. Population subdivision was particularly pronounced with 19 of 21 sample pair-wise ΦST values significantly different from zero and ranging from 0.064 to 0.343 (P ≤ 0.05). About 11 of 39 alleles were private alleles that also tended to be in high frequency in the populations where they occurred (average frequency ~27%). The correlation of genetic and geographic distances was highly significant and positive (r 2 = 0.8733 and P < 0.001) with ΦST increasing by ~0.01 for every 10 km of separation. Overall, salt marsh snake populations appear to be fractured into isolated neighborhoods on the order of 50–80 km. In spite of its apparent local abundance, we believe that N. c. compressicauda is in need of conservation protection. The combination of extremely low dispersal, narrow habitat requirements, and most importantly, extensive habitat alteration resulting from coastal real estate development may mean that N. c. compressicauda is highly susceptible to population extirpation and potentially extinction.