Buyers Chasing Waterfront Properties Regardless of High Flood Risks

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Key Highlights

  • Median sale price on waterfront/lakefront properties outside of major metros surged during pandemic
  • That median sale price hit +14% premium during Q1 2021

Homebuyers Continue Chasing Waterfront/Lakefront Properties

The rush to buy waterfront/lakefront properties began during 2013.  With that rush to buy came a premium sales price of some 7% for homes with high flood risk over homes with low flood risks.

Now, according to Redfin, that premium sales price for waterfront/lakefront homes with high flood risk has increased to 14% over homes with low flood risk.  The median sale price of homes with high flood risk was $402,010 during Q1 2021.  This median sale price of $402,010 compares with the median sale price of $353,783 for homes with low flood risk.

This 14% differential between high flood risk properties and low flood risk properties during  Q1 2021 increased from a premium of 10.1% during Q1 2020 and 7.2% premium during Q1 2019.

Sales of Waterfront/Lakefront Homes with High Flood Risk Surging

Properties prone to flooding saw a year-over-year uptick in sales of +18.6% in Q1 2021…double the +9.6% gain in sales of low flood risk homes..

Sheharyar Bokhari, senior economist with Redfin, said, “Americans are buying the beach houses they always dreamed of because they have the flexibility to work from wherever they want.”

Bokhari continued.  “While flood risk is intensifying in many parts of the country, it doesn’t seem to be a deal breaker for a lot of homebuyers.  This may be because buyers aren’t aware they’re purchasing a home in a flood plain or don’t view it as an immediate danger.”

More Homeowners Now Working to Safeguard Against Climate Change Risks

According to Redfin, one in five homeowners has been and continues to take proactive steps to help guard against increasingly intensifying risks of climate change.  Wanting their homes to be more resilient in the face of flooding is their motivation.

Additionally, 50% of potential homebuyers indicated that the increasing intensity and frequency of natural disasters played a significant role in their desire to relocate.

 

Thanks to Redfin.

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