Climate Change Driving Down Oceanfront Property Values

Mother Nature may be shortening the divide between the haves and the have-nots.

The value of once-coveted beachfront properties in places like Cape Cod and Nantucket is plummeting fast due to shrinking shorelines, Bloomberg reported.

Although this is devastating to families who expected their beachfront property to be long-term investment, it’s a magnificent opportunity for others.

David Moot is one example. He told the outlet that he bought a beachfront property in Cape Cod at a shocking 67 percent discount. He paid just $395,000 for property that had been listed for almost $2 million only two years earlier.

But the lifespan of the home is significantly shortened by the 25 feet of eroding sand bluff separating it from the ocean. Tide projections predict the home will be underwater in less than ten years, the outlet said.

Its new owner is unphased though. Moot told Bloomberg, “Life’s too short, and I just said to myself, ‘let’s just see what happens.’” At 59, he reasons that if it ends up in the ocean, “it may or may not be in my lifetime.”

Beach erosion also forced Starwood Capital Group’s chief executive Barry Sternlich to demolish a Nantucket property that he paid close to $2 million for years ago. Lucky for him, he’s worth $3.8 billion dollars, according to Forbes, so he can weather the loss.

Another family lost a $2 million Nantucket home at 21 Sheep Pond Road after the town ratified an emergency condemnation order on the property. The home had lost 35 feet of dune in just one year before a summer storm finally took out the southeast corner of the home. It collapsed and took an excavator less than an hour to demolish the rest, according to the outlet. The family had purchased it for $557,000 in 1995.

Expect to see more of this – and more bargains like the one David Moot scored.

Other areas facing similar risks include Montauk, Charleston, Boston, Bay Harbor, Miami and Key West, according to data from the International Panel on Climate Change.

Nantucket is at the very top of that list, with some areas seeing beach erosion of more than 12 feet per year.

The National Park Service in the Outer Banks is scooping up some of those bargain-priced properties to demolish them. It’s a protective measure to keep debris out of coastal ecosystems, the outlet said.

Major insurers are declining to offer coverage for homes threatened by beach erosion. David Moot said he pays $4,000 per year for homeowners insurance – the same amount as his property taxes – and it doesn’t even cover erosion-related damages.

— Christina Previte