{"id":10447,"date":"2024-01-06T15:20:07","date_gmt":"2024-01-06T15:20:07","guid":{"rendered":"https:\/\/imsfund.com\/?p=10447"},"modified":"2024-01-06T15:20:07","modified_gmt":"2024-01-06T15:20:07","slug":"new-flood-zones-could-skyrocket-housing-costs-in-the-midwest-heres-what-you-need-to-know","status":"publish","type":"post","link":"https:\/\/imsfund.com\/index.php\/2024\/01\/06\/new-flood-zones-could-skyrocket-housing-costs-in-the-midwest-heres-what-you-need-to-know\/","title":{"rendered":"New Flood Zones Could Skyrocket Housing Costs in the Midwest\u2014Here\u2019s What You Need To Know"},"content":{"rendered":"<p> <br \/>\n<\/p>\n<div :class=\"{ 'hidden': $store.proContent.showFullPrompt() }\">\n<section class=\"px-4 relative border border-slate-200 mobile-toc lg:hidden\" x-data=\"{open:false}\">\n<button x-on:click=\"open = !open\" class=\"flex items-center gap-4 my-2 border-none w-full\"><br \/>\n<svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"h-6 w-6\" fill=\"none\" viewbox=\"0 0 24 24\" stroke=\"currentColor\" stroke-width=\"2\"><path stroke-linecap=\"round\" stroke-linejoin=\"round\" d=\"M4 8h16M4 16h16\"\/><\/svg><\/p>\n<p class=\"font-semibold text-slate-800 text-base m-0 js-toc-ignore\">In this article<\/p>\n<p><\/button><\/p>\n<\/section>\n<p><span data-preserver-spaces=\"true\">If you\u2019ve been reading the BiggerPockets Blog for any length of time now, you\u2019ll have noticed that the Midwest has often been named as one of the best places to invest in real estate right now. It offers reasonable home and rental prices and stable job markets in major cities. The result is a buoyant housing market that has so far avoided the post-pandemic slump seen in other areas.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">But what if we told you that, while all this is true, the Midwest is also the most at-risk area for flood damage over the next 20 years\u2014with all the related consequences: abandoned communities, dropping house prices, and rising insurance costs that will make homes less attractive for both buyers and investors?<\/span><\/p>\n<h2 class=\"wp-block-heading\"><span data-preserver-spaces=\"true\">The Midwest: An Upcoming Flood Zone<\/span><\/h2>\n<p><span data-preserver-spaces=\"true\">Unfortunately, according to the latest cutting-edge research from the climate risk-focused nonprofit\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/firststreet.org\/\" target=\"_blank\" rel=\"nofollow noopener\"><span data-preserver-spaces=\"true\">First Street Foundation<\/span><\/a><span data-preserver-spaces=\"true\">, it\u2019s all true. The Midwest has the highest projected share of what the foundation is calling Future Climate Abandonment Areas\u2014areas that will see population declines over the period between 2023 and 2053 because of increasing damage from floods.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">How can we trust this new research? It\u2019s highly detailed, and it\u2019s based on real data from flood risk assessments performed on real homes. Instead of making sweeping statements about the most at-risk states (<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.biggerpockets.com\/blog\/florida-rental-market\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">Florida<\/span><\/a><span data-preserver-spaces=\"true\">\u00a0and Texas are well known to be at huge risk of regular flooding), the researchers adopted what they\u2019re calling a \u2018\u2018granular\u2019\u2019 approach, assessing communities county by county and even block by block. \u2018\u2018Climate risk is a house-by-house issue, not a state-by-state issue,\u2019\u2019 the report says.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">This method of projecting where Climate Abandonment Areas will be clustered offers a great advantage because flood risk can vary significantly within small areas. Quite simply, even within a single city, there will be areas that are far more prone to flooding than others. It can even come down to one block of houses being at a greater risk than another.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Looking at the map First Street provides as part of its report, high-risk areas are dotted throughout the country rather than covering whole states uniformly. However, it\u2019s clear that the Midwest will experience climate-related relocations and property abandonment disproportionately over the next 20 years.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">The areas most at risk for these changes are located in Illinois, Michigan, Indiana, and Ohio. The cities projected to have the highest rate of growth of climate abandonment areas are Minneapolis (Hennepin and Ramsay counties), Indianapolis (Marion County), and Milwaukee.\u00a0\u00a0<\/span><\/p>\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"926\" height=\"541\" src=\"https:\/\/bpimg.biggerpockets.com\/https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2024\/01\/image2-1.jpeg?twic=v1\/cover=926:541\/max=1000\" alt=\"image2 1\" class=\"wp-image-164152\" srcset=\"https:\/\/bpimg.biggerpockets.com\/https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2024\/01\/image2-1.jpeg?twic=v1\/cover=926:541\/resize=926\/max=1000 926w, https:\/\/bpimg.biggerpockets.com\/https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2024\/01\/image2-1.jpeg?twic=v1\/cover=926:541\/resize=300\/max=1000 300w, https:\/\/bpimg.biggerpockets.com\/https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2024\/01\/image2-1.jpeg?twic=v1\/cover=926:541\/resize=768\/max=1000 768w, \" sizes=\"auto, (max-width: 926px) 100vw, 926px\" title=\"New Flood Zones Could Skyrocket Housing Costs in the Midwest\u2014Here\u2019s What You Need To Know 2\"\/><figcaption class=\"wp-element-caption\"><em>Markets facing the highest climate abandonment risk \u2013 <a href=\"https:\/\/firststreet.org\/\" target=\"_blank\" data-type=\"link\" data-id=\"https:\/\/firststreet.org\/\" rel=\"nofollow noreferrer noopener\">First Street Foundation<\/a><\/em><\/figcaption><\/figure>\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"1012\" height=\"781\" src=\"https:\/\/bpimg.biggerpockets.com\/https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2024\/01\/image1-1.jpeg?twic=v1\/cover=1012:781\/max=1000\" alt=\"Markets forecasted to experience population decline due to flood risk - First Street Foundation\" class=\"wp-image-164151\" srcset=\"https:\/\/bpimg.biggerpockets.com\/https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2024\/01\/image1-1.jpeg?twic=v1\/cover=1012:781\/resize=1012\/max=1000 1012w, https:\/\/bpimg.biggerpockets.com\/https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2024\/01\/image1-1.jpeg?twic=v1\/cover=1012:781\/resize=300\/max=1000 300w, https:\/\/bpimg.biggerpockets.com\/https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2024\/01\/image1-1.jpeg?twic=v1\/cover=1012:781\/resize=768\/max=1000 768w, \" sizes=\"auto, (max-width: 1012px) 100vw, 1012px\" title=\"New Flood Zones Could Skyrocket Housing Costs in the Midwest\u2014Here\u2019s What You Need To Know 3\"\/><figcaption class=\"wp-element-caption\"><em>Markets forecasted to experience population decline due to flood risk \u2013 First Street Foundation<\/em><\/figcaption><\/figure>\n<p><span data-preserver-spaces=\"true\">What the research\u00a0<\/span><em><span data-preserver-spaces=\"true\">doesn\u2019t\u00a0<\/span><\/em><span data-preserver-spaces=\"true\">mean is that these areas will suffer some kind of disaster movie-style exodus. As the report explains, \u2018\u2018While many areas in these states are projected to decline in population with high flood risk, other areas of the state may see growth as populations redistribute to avoid risk.\u2019\u2019<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">As the researchers emphasize, most research into\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.biggerpockets.com\/blog\/8-million-people-moved-in-2022-according-to-census\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">migration patterns<\/span><\/a><span data-preserver-spaces=\"true\">\u00a0tends to focus on dramatic interstate migrations, e.g., from New York City to Florida. In reality, that\u2019s not how the majority of Americans move. Most people move very locally, not just within their state but within their local county. These localized moves are driven by \u2018\u2018individual preferences to remain close to their families, support networks, local labor market, and familiarity with the local housing market.\u2019\u2019<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">In other words, people may be pushed to leave their homes if they keep flooding, but they will tend to go to the next town over rather than across the country.\u00a0<\/span><\/p>\n<h2 class=\"wp-block-heading\"><span data-preserver-spaces=\"true\">Make Sure to Do Your Due Diligence<\/span><\/h2>\n<p><span data-preserver-spaces=\"true\">The First Street report drives home the importance of real estate investors doing thorough local\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.biggerpockets.com\/blog\/real-estate-investment-analysis\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">research<\/span><\/a><span data-preserver-spaces=\"true\">. Investing in low-flood risk areas should become best practice for anyone serious about investing in the Midwest. It could make a difference between investing in a community that will have a healthy housing market in a decade or two and one with an ailing housing market with low property values and unattractively high flood insurance premiums.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">In fact, a recent\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/link.springer.com\/article\/10.1007\/s11113-018-9473-5\" target=\"_blank\" rel=\"nofollow noopener\"><span data-preserver-spaces=\"true\">study<\/span><\/a><span data-preserver-spaces=\"true\">\u00a0has shown a direct correlation between increased flood risk and declining property values. Add to that the already existing problems with population declines in some areas of the Midwest, and the flood risk becomes a tipping point.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">The fact is that many people don\u2019t want to move away from their homes\u2014until they feel that there is no alternative. Communities that are already on the brink because of other issues (e.g., a lack of jobs) are more likely to empty out when the climate change risk is added to the equation.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Philip Mulder, a professor at the risk and insurance department of the University of Wisconsin-Madison, explained the difference between the Midwest and somewhere like, say,\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.biggerpockets.com\/blog\/moving-to-miami-could-save-thousands-but-what-is-that-doing-to-prices\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">Miami<\/span><\/a><span data-preserver-spaces=\"true\">, in an interview with\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/fortune.com\/2023\/12\/18\/flood-risk-climate-change-moving-climate-abandonment-area\/\" target=\"_blank\" rel=\"nofollow noopener\"><em><span data-preserver-spaces=\"true\">Fortune<\/span><\/em><\/a><span data-preserver-spaces=\"true\">. Mulder points out that Miami is also at high risk of flooding, but it\u2019s still a place with a vibrant economy, with many people still wanting to move there despite the flood risk, \u2018\u2018whereas in the Midwest, you may see there\u2019s not the same reason for people to be there. So flood risks become sort of a tipping point that pushes people out of communities.\u2019\u2019<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Real estate investors who are looking at the Midwest should assess multiple risk factors when selecting a location to invest in. While\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.biggerpockets.com\/blog\/safest-and-least-safe-real-estate-markets-from-natural-disasters\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">flood risk<\/span><\/a><span data-preserver-spaces=\"true\"> on its own may not automatically make a place unsuitable for real estate investing, this factor, plus an existing population decline and a stagnant or declining local economy, almost certainly does.<\/span><\/p>\n<div id=\"visibility-group-block_64dd561cede13\" class=\"visibility-group  hidden\">\n<div id=\"hero-block_62df1a82bfc88\" class=\"first:mt-0 hero-block py-4    has-background has-slate-200-background-color has-text-color has-theme-gold-color\">\n<div class=\"gap-10 lg:gap-20 flex flex-wrap lg:flex-nowrap max-w-screen-xl mx-auto px-4 relative lg:items-center \">\n<div class=\"relative z-30 lg:w-1\/2 \">\n<main class=\"py-4\"><\/p>\n<p class=\"has-slate-800-color has-text-color has-large-font-size\" style=\"font-style:normal;font-weight:800\">Find an Agent in Minutes<\/p>\n<p class=\"my-3 md:my-5 lg:my-8 has-slate-900-color has-text-color\" style=\"font-size:18px\">Match with an investor-friendly agent who can help you find, analyze, and close your next deal.<\/p>\n<p><\/main>\n<\/div>\n<div class=\"lg:w-1\/2 first:mt-0 relative h-full lg:flex lg:items-center\">\n<img decoding=\"async\" class=\"object-cover w-full relative z-20 my-0  rounded-md hidden lg:block\" src=\"https:\/\/bpimg.biggerpockets.com\/https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2022\/08\/Agent-Finder-Block-2.png\" alt=\"find an investment-friendly real estate agent\" title=\"New Flood Zones Could Skyrocket Housing Costs in the Midwest\u2014Here\u2019s What You Need To Know 4\"\/>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"wp-block-group is-layout-constrained wp-block-group-is-layout-constrained\">\n<div class=\"wp-block-group__inner-container\">\n<div class=\"wp-block-group__inner-container\">\n<div id=\"visibility-group-block_64dd31c79f00f\" class=\"visibility-group  \">\n<div id=\"hero-block_64dd2875dba9d\" class=\"first:mt-0 hero-block py-4    has-background has-slate-100-background-color has-text-color has-theme-slate-color\">\n<div class=\" flex flex-wrap lg:flex-nowrap max-w-screen-xl mx-auto px-4 relative lg:items-center \">\n<div class=\"relative z-30 w-full \">\n<main class=\"py-4\"><\/p>\n<p class=\"my-3 md:my-5 lg:my-8 has-theme-slate-color has-text-color\" style=\"font-size:16px;font-style:normal;font-weight:400\">Ready to succeed in real estate investing? Create a free BiggerPockets account to learn about investment strategies; ask questions and get answers from our community of +2 million members; connect with investor-friendly agents; and so much more. <\/p>\n<p><\/main>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<p class=\"italic\"><b>Note By BiggerPockets:<\/b> These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.<\/p>\n<\/div>\n<\/div>\n<p><br \/>\n<br \/><a href=\"https:\/\/www.biggerpockets.com\/blog\/new-flooding-risk-in-midwest-will-raise-housing-costs\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>In this article If you\u2019ve been reading the BiggerPockets Blog for any length of time now, you\u2019ll have noticed that the Midwest has often been named as one of the best places to invest in real estate right now. It offers reasonable home and rental prices and stable job markets in major cities. The result [&hellip;]<\/p>\n","protected":false},"author":5,"featured_media":10448,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"fifu_image_url":"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2024\/01\/flooding-1024x517.jpg","fifu_image_alt":"","footnotes":""},"categories":[9],"tags":[],"class_list":["post-10447","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog"],"_links":{"self":[{"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/posts\/10447","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/comments?post=10447"}],"version-history":[{"count":1,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/posts\/10447\/revisions"}],"predecessor-version":[{"id":10449,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/posts\/10447\/revisions\/10449"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/media\/10448"}],"wp:attachment":[{"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/media?parent=10447"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/categories?post=10447"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/tags?post=10447"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}