The nation's housing market could be overvalued by as much as $237 billion, due to the unacknowledged risk of flooding due to climate change, according to research published in the journal Nature Climate Change.
Michigan's housing market could be overvalued by about $1.5 billion, according to study co-author Jeremy Porter of First Street Foundation.
Porter said people may know if they're in or near a FEMA flood zone, but those zones don't tell the whole story.
"The FEMA zones really don't capture the heavy flooding that happens in Michigan from rainfall events," said Porter. "And the other thing is, as the climate changes, we're going to get more of those heavy, heavy rainfall events and that's just going to increase the flooding."
Porter said the risk is concentrated in cities with lots of homes like Grand Rapids and Detroit. He said homeowners should be aware that over time, savvy home buyers will want to know more than how many bathrooms and bedrooms a house has.
"Now people are asking how many bedrooms, how many bathrooms and what's the elevation of the house. So the elevation's actually become an amenity in those areas where people are aware of climate risk," he said.
The research also indicates which counties and local governments face the most overvaluation risk.
The top five counties in regards to total overvaluation are:
Kent County: $205,633,749
Midland County: $117,256,631
Leelanau County: $115,639,143
Oakland County: $109,986,804
Wayne County: $74,680,320
Some counties are more susceptible than others due to their high dependence on property taxes as a source of local revenue. The top five counties that depend most heavily on property taxes as a source for revenue are:
Otsego County, 46%
Livingston County, 41%
Oakland County, 38%
Macomb County, 38%
Midland County, 37%
You can look up your own house or neighborhood's overvaluation risk at riskfactor.com
