Can You Escape Climate Gentrification if You’re Rich?
When a luxury real estate agent heard that a Harvard academic was preaching that home prices in elevated areas of Miami were rising with the sea level, she called his report “fake news.” “I have not talked to one buyer — not one — who said, ‘I’m not buying in Miami because of sea-level rise,’” she told the Miami Herald. “It’s a simple ebb and flow of the real estate market, not the ocean.”
Well, responded the academic, Jesse M. Keenan, a faculty member of Harvard’s Graduate School of Design, who for years has been studying the impact of climate change on cities, what can he say? “There’s some contingent who are just deniers because they don’t want it to impact their jobs or people’s perception.”
For his study of climate gentrification in the Miami area, published in Environmental Research Letters, Keenan and his co-authors, Thomas Hill and Anurag Gumber, ran a computer analysis of 800,000 properties. They also interviewed 48 local officials, researchers, real estate developers, investors, financiers, residents, and activists. “A consumer preference may exist,” they concluded, “in favor of higher-elevation properties. Likewise, lower-elevation properties may be subject to lower rates of appreciation due to flooding concerns.”
The data lent support to the climate gentrification hypothesis, which states that “climate change impacts arguably make some property more or less valuable by virtue of its capacity to accommodate a certain density of human settlement and its associated infrastructure,” and that the resulting price volatility may help drive “patterns of urban development that lead to displacement (and sometimes entrenchment) of existing populations consistent with conventional framings of gentrification.”
Keenan is a fifth-generation Floridian and maintains an office in Miami. “I have an emotional bias for helping the state of Florida adapt to climate change,” he said. And, sure, he’s met real estate people who deny the threat of climate change on property values. He’s heard that some locals reject his thesis that properties in Miami neighborhoods like Little Haiti are increasingly gaining in value while those in lower-elevation areas, including the famously affluent Miami Beach, are not. But at the same time, Keenan said, he has met real estate brokers and developers who have seen the writing on the sea wall.
“What we found is that in certain areas, those on the edge between low and high sea-level exposure, the real estate agents were using that to their advantage,” Keenan said. “They’d say to potential clients, “Oh, you don’t want to work with that person over there in that neighborhood, because that place floods all the time. We’ll drive over there and you can see there’s standing water. But over here, on higher elevation, on my turf, this is a safer place to live long term.”
Developers are the same. “I know a lot of the major home builders and commercial developers in Miami, and they are highly attuned to this,” Keenan said. “Even in luxury condominium projects, they are using climate in their marketing materials. They’re marketing the fact that they’ve built in resilient technologies. They’re saying, ‘You know, our product is differentiated because we’ve built in these pumping systems, and yadda yadda yadda.’”
Keenan’s paper cracks open a window onto some of today’s fiercest cross-currents, including gentrification, inequality, and the cultural head-banging over climate science. To get a wider understanding of what Keenan discovered in Miami and how his findings speak to the rest of the country, I rang him up on a recent morning in San Francisco, where he’s currently a visiting scholar at the Federal Reserve Bank.
Kevin Berger: How did you come up with the term “climate gentrification”?
Jesse Keenan: Back in 2012 and 2013, I was overseas, doing work related to climate adaptation — how the built environment in cities is beginning to adapt to climate change. In Copenhagen, I observed the extent to which investments in resilience and hazard mitigation in buildings and infrastructure was having a collateral impact. One of the negatives was the investments were creating a kind of amenity. It was increasing the performance of a neighborhood. The designs themselves were making a particular neighborhood more attractive and it was operating to displace people in the sense that rents were going up. There was an inherent irony in that public policy that was trying to protect people was actually driving them out.
Did the gentrification break down along socioeconomic lines?
Well, it just happened to be that the neighborhood they were working in was historically lower class and lower income. In terms of environmental justice, you’ll see that some of the most disadvantaged communities are those that have high degrees of environmental exposure. So this is not out of the ordinary. I observed similar things in Hong Kong and other places in the world.
Is climate-change gentrification driving displacement?
I think what you see with climate change is that the increased severity of storms and the shocks associated with them do lead to displacement. New Orleans is a classic example. After Hurricane Katrina, New Orleans became much wealthier. On an isolated neighborhood-by-neighborhood basis, New Orleans increased its average annual income. So that is a general tendency. Those that can afford to build back usually build back with a greater intensity of economic investment. And sometimes they buy out their neighbors.
Do you see signs of this kind of displacement in Miami?
Yes, rents are going up, and this is felt not only in the residential rental market, but also in the retail market. You’re already seeing displacement in small businesses, where both commercial offices and localized retailers are feeling the effects of land pricing kick in. In a lot of these neighborhoods, these are fairly older fixed-income populations. What seems to you and me to be small changes in rent can be completely disastrous to a fixed-income retiree. Or someone who’s not even a retiree but should be retired by virtue of their age, but they’re still in the labor force. So you see just a wide range of small mom-and-pop grocery stores getting shut down due to retirees being displaced.
What’s another surprising effect of climate gentrification?
One of the signs we found a number of years ago, related to climate gentrification, was on the beaches and barrier islands that experienced a lot of tidal flooding. Saltwater is very damaging to cars. If you’re a car insurance company, it cost you a lot more money to repair a car that’s been impacted by saltwater because it’s just so corrosive. So they started dropping coverage on the beaches, and they started increasing their rates. Now, most of the labor force, and most of the jobs, are on the mainland; they’re not on the beaches. People have to commute back and forth every day. Once you are living there and you can’t get car insurance, you have to move to the mainland. So even car insurance is an enormous cost burden that drives people from their homes.
Will climate gentrification affect the poor most strongly?
This is going to impact everybody. This will have widespread impacts on housing, transportation, and economic costs, and impact everybody living in South Florida, because they’ve largely run out of land. And that includes land that can reasonably service utilities and urban services. As land starts to shrink, that shrinks economic output, which means it impacts jobs, it constrains housing. I mean, Miami is already on the precipice of wholly lacking in qualitative necessities. It’s already on the breaking point. Traffic is out of control. Mass transit is inadequate. The inequality of income in Miami is extreme, like San Francisco. It all adds up to compromising the viability of Miami as an economic unit and as a place to live.
Journalist Jessica Moulite has reported that “racist housing practices drove Black people in Miami to create their own communities where they could, which happened to be on higher ground. Now, higher ground is a commodity that residents of Black neighborhoods believe to be driving their displacement.”
The fact that a neighborhood is populated by an African-American community, and is on high elevation, is one of those historic inequities. It came about because discriminatory practices in land-use planning relegated those historically disadvantaged communities to higher elevation. So there’s an extremely perverse sort of irony here that those communities will be again disadvantaged by virtue of where they live. It’s institutionalized racism that’s having a legacy. There’s no doubt that it’s a phenomenon, and it’s something we talk about in the paper.
But there’s another perspective here. Those are the front lines, but there are places in Miami that have a range of diversity in race and class that will be impacted by virtue of their environmental exposure, so it’s not like climate gentrification is just speaking to communities along racial terms. Climate change is an equal opportunity offender. We have to expand our horizons to understand that this is going to impact Hispanic communities, Dominican, Cuban, Haitian. It’s going to impact so many communities in Miami, and not just localized areas of historic segregation. Maybe we should, in terms of short-term policy accommodations, try to mitigate some of the damage there. But we can’t lose perspective that this is a much larger problem.
Even if climate change is an equal opportunity offender, don’t you think it’s the poor who are going to get shafted?
Well, that would be the history of America. There’s no doubt, given the relative elasticity of the dollar, that the benefit of $1 to a billionaire compared to the benefit of $1 to someone who has $100,000 in student loans are two different things. Given the huge disparity of income in Miami-Dade County — there’s a whole lot of rich people and an awful lot of very poor people — the poor will bear that burden, and that’s inherent in the theory of climate gentrification. But while race and class are an important part of the story, what climate gentrification is deeply concerned with is this is going to impact the most valuable assets that people will ever have in their lives, and that’s their home or small business. This is not about whether you believe in climate change or not; it’s about the impact climate change will have on your livelihood and your pocketbook.
Does your study of Miami contain a lesson for the rest of the country?
Climate gentrification isn’t just about sea-level rise. It’s also about forest fires. We’re starting to see climate gentrification happen in Sonoma County after the Santa Rosa fire. And it’s also about water availability for potable water, which is driving land pricing in California’s Central Valley. So this is not just about Miami. The lesson to be learned is this is happening in different ways in nearly every coastal town and community in the United States. You’re going to have a different story, a different timeline, a different range of movement in the market. But it’s happening from the Delaware shore to Jersey shore to the coastal Carolinas to Pacific coasts all the way to Oregon.
Climate gentrification may unevenly impact rich and poor, but it’s going to impact everybody. It’s going to impact you whether you live on the coast or 100 miles from the coast. Some people may live in the middle of nowhere and not necessarily be impacted. But for millions and millions of people in the United States, rich and poor, middle income, white, black, Hispanic, or Asian, this is going to impact our daily lives and household budgets, our net accumulation of assets, and our net savings. It’s economics. Land is being consumed by sea. When that happens, people get displaced. It’s just that simple.