Climate Risk in the Housing Market Has Echoes of Subprime Crisis, Study Finds: NYT

"Asaf Bernstein, an economist at the University of Colorado in Boulder, said the findings highlighted another problem: By agreeing to buy mortgages for homes at risk from climate change, without charging a premium that reflects that risk, the federal government had effectively encouraged home construction and purchases in vulnerable areas.

“It’s basically an implicit subsidy,” Mr. Bernstein, who was not involved in the study, said.

Economists at both Fannie and Freddie have warned in the past of the risks that climate-related increases in flooding pose to the mortgage industry. In 2016, Sean Becketti, then the chief economist at Freddie Mac, wrote that rising seas “appear likely to destroy billions of dollars in property.”

“The economic losses and social disruption may happen gradually, but they are likely to be greater in total than those experienced in the housing crisis and Great Recession,” he wrote. “It is less likely that borrowers will continue to make mortgage payments if their homes are literally underwater.”

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'It doesn't feel justifiable': The couples not having children because of climate change: SMH