Image by Breno Assis.
Real estate has become climate change’s biggest victim. Climate change is attacking America’s most valuable, biggest asset class. For the first time in history there are regions of the country where major property insurers have dropped coverage altogether as elsewhere rates are on the climb, pricing some buyers out of the market.
America’s politicians punted on tackling climate change decades ago, except for Senator Sheldon Whitehouse, who has masterfully delivered more than 290 “Time to Wake Up” climate speeches to the Senate, calling out deniers and demanding bold action. If Congress had been composed of “Whitehouse intellect,” the world climate system would be in much better shape today. And not threatening the American Dream of Homeownership.
At a Senate confirmation hearing for Trump appointee Michael Faulkender as Deputy Treasury Secretary, Senator Whitehouse opened up all firing cylinders, blasting away like there’s no tomorrow, which may be where we’re headed after listening to the senator’s scolding rendition of how Congress has failed climate change impacting the financial system and US economy. In short, climate change is raising hell with the financial system as US property insurance goes up in flames.
In his opening remarks, the senator referenced “very dark economic storm clouds on the horizon,” because of climate change which the administration cannot seriously address because massive political funding has made it “an article of faith to deny climate change,” in fact, claiming “it’s a hoax.” This perverse attitude is now holding America’s homeowner’s hostage.
Interestingly, over past decades, scientists have gotten it right, even the Exxon scientists got it right, meaning, fossil fuel emissions (CO2) cause climate change. Nevertheless, Congress has failed to act because of pressure by fossil fuel interests, including the “largest campaign of disinformation that America has ever seen,” as dark money spills out all over the place. As a result, all serious bipartisan efforts on The Hill on climate change have been squelched. Poof!
Disinformation, disinformation, disinformation has been the guiding light of climate denialism. It’s a hoax; it’s a hoax; it’s a hoax; it’s fake news; it’s fake news, repetition creates fact.
As the senator and the Trump appointee discussed in a meeting beforehand in the senator’s office, the consequences of climate change are severe based upon professional risk judgement where fiduciary responsibly is considered. For example, the chief economist of Freddie Mac told committee hearings we are headed for a “property insurance collapse” that will cascade into a crash in coastal property values that will be so significant that it will cascade into the entire economy, same as 2008. That’s the warning on coastal properties. Additionally, wildfires have now added new property insurance risks that are far removed from coastal property. Climate change knows no boundaries as congressional ineptness and timidity to challenge it clobbers American homeownership.
Senator Whitehouse offered one example after another of how climate change is undermining the financial system of America. In a recent Senate banking committee hearing, the Fed Chairman said there will be “areas of the country where you can’t get a mortgage any longer” because of climate change; a very stern warning that something has to change.
Also, as related by the senator, the Financial Stability Board, the entity that warns the international banking system of impending issues gives the same warning that “property insurance has become a major risk to the survival of the economic system.”
And even closer to home base, meaning Congress itself, a recent bipartisan CBO (Congressional Budget Office) report identified fires, floods and climate change in toto, threatening to undermine our financial system. Yet, Congress ignores its own warnings.
And The Economist magazine cover story in April 2024 depicted climate damage undermining insurance markets and threatening the biggest asset class in the world, RE. predicting a 25 trillion dollar hit to RE because of climate change.
Senator Whitehouse: “The lie that climate change is a hoax is no longer just an act of political malfeasance. It is now an act of economic malfeasance.” Climate change is hitting America’s pocketbooks throughout the country like an early summer thunderstorm crackling in the sky.
The financial/Wall Street/economic impending upside down collapse due to radical climate change should be item number one on Congress’s docket to do whatever is necessary, but it’s not even given a glancing look. Yet, the insurance industry is feeling the heat; homeowners are feeling the heat. Mortgage companies are feeling the heat. And Wall Street is starting to feel the heat. Can the Trump climate hoax syndrome, “ignore it, it’s not real… it’s fake news” hold up in the face of extremely severe financial strain impacting the world’s largest asset class, real estate?
“President Trump issued an executive order aimed at dismantling many of the key actions that have been undertaken at the federal level to address climate change. The order, ‘Promoting Energy Independence and Economic Growth.” (Trump Issues Executive Order on Climate Change, Sabin Center for Climate Change Law, Columbia Law School)
Nobody’s Insurance Rates Are Safe From Climate Change, Yale Climate Connections, January 14, 2025.
Property Values to Crater Up to 60% Due to Climate Change, Business Insider, Aug. 9, 2024.
U.S. Department of the Treasury Report: Homeowners Insurance Costs Rising, Availability Declining as Climate-Related Events Take Their Toll, U.S. Department of the Treasury, January 16, 2025.
Next to Fall: The Climate-driven Insurance Crisis is Here – And Getting Worse, Senate Budget Committee, Dec. 18, 2024.
Climate Risk Will Take Trillion-dollar Bite Out of America’s Real Estate, Report Finds, USA Today, Feb. 7, 2025.
Homeowners Insurance Sector Slammed by Climate Impacts, Insurance Business America, May 14, 2024.
Climate Change Is Coming for U.S. Property Prices, Heatmap News, Feb. 3, 2025.
Insurers Are Deserting Homeowners as Climate Shocks Worsen, The New York Times, Dec. 18, 2024.
Climate Resiliency Flips the Housing Market Upside Down, Forbes, Feb. 20, 2025.
Climate Change Set to Lower Home Prices, Business Insider, Feb. 4, 2025.
How Climate Change Could Upend the American Dream, Propublica, Feb. 3, 2025.
Climate Change to Wipe Away $1.5 Trillion in U.S. Home Values, Study Says, The Wall Street Journal, Feb. 3, 2025.
Opinion: That Giant Sucking Sound? It’s Climate Change Devouring Your Home’s Value, The New York Times, Feb. 3, 2025.
How and Where Climate Change Will Lower U.S, Home Values, Context News, Feb. 10, 2025.
Climate Change Is Driving an Insurance Crisis, The Equation – Union of Concerned Scientists, June 19, 2024.
Risky Real Estate: How Climate Risk is Changing Prices, Medium, March 3, 2025.
At Least 20% of U.S. Homes Will be De-Valued Due to Climate Change, Says DeltaTerra CEO Dave Burt, CNBC, Feb. 19, 2025.
Climate Change is Fueling the US Insurance Problem, BBC, March 18, 2024.
US Housing Market May Face Losses Due to Climate Change, Realty, Feb. 21, 2025.
Nearly Half of U.S. Homes Face Severe Threat from Climate Change, Study Finds, CBS News, March 13, 2024.
The Possible Collapse of the U.S. Home Insurance System, The New York Times, May 15, 2024.
The Climate Crisis Will End Home Ownership as We Know It and Eventually Crash the Economy, Splinter, Jan. 8, 2025.
Fake news?
The big question going forward is whether climate change’s real estate devaluation, which impacts every American household, will take MAGA down to its knees, drowning its lameness in a sea of turbulent financial chaos followed by a massive irrepressible political tsunami payback event that cleanses the nation of lies?