When buying, selling, or using a tangible asset such as a home, building, or work of art, the condition of the tangible asset is important. Condition affects the purchase, use, and sale of a tangible asset.
What factors inform the condition of tangible assets and the markets for tangible assets? There are many.
The New York Times has been following the interactions of the real estate market (purchase and sale transactions, predicated on condition) with documented effects of changing climate and more frequent occurrences of extreme weather.
Information and perspective around such interactions are presented in the November 24, 2016 article, “Perils of Climate Change Could Swamp Coastal Real Estate.”
Pertinent questions arise. What information. How sourced. How to make use of information. How to turn challenges into opportunities. Opportunities at point of purchase, at point of sale, and during the lifetime and use of the asset. Opportunities for health, wellness, lifestyle, and value.
Here is an excerpt:
“As difficult as it is to predict the pace of climate change, modeling how it will affect the real estate market is even more complicated. Like a game of hot potato, builders, homeowners, banks, flood insurers and buyers of securitized mortgages try to hand off risky properties before getting burned. Developers erect houses and sell them typically within a couple of years, long before their investments depreciate. Banks earn commissions even on risky home loans before bundling these mortgages into securities and selling them to large pension funds, insurers or other buyers.
“Home buyers tend to think short term, focus on what they can afford and hope that the local infrastructure keeps pace with the rise in sea levels. Home buyers are also generally on their own as they look at prospective properties and try to size up their risk, as real estate agents vary in what they disclose.
“… Good information is hard to come by. No one knows whether, when or by how much properties will depreciate, seas will encroach or flood insurance policies will change.”
See: “Perils of Climate Change Could Swamp Coastal Real Estate” | Ian Urbina, The New York Times, 24 November 2016