Wired, June 17, 2024, Banks Are Finally Realizing What Climate Change Will Do to Housing
Rising sea levels, biodiversity collapse, extreme weather—these are the grisly horsemen of climate apocalypse. But don’t forget the fretting loan officers. A study published earlier this year found that US mortgage approvals tend to dip following periods of hotter-than-normal weather. For every 1 degree Celsius that temperatures rise above average, approvals fell by nearly 1 percent—and their value by more than 6.5 percent.
Lower consumer demand was only part of the problem, according to the study’s authors. The effect was mostly down to loan officers’ worries about climate change and what it might mean for the assets they were lending against. In other words, climate change was devaluing property before their very eyes.
