Risk assessment of the future climate impact on real estate in Germany

Every year natural hazards cause damages to the building stock amounting to millions or even billions of Euros in Germany. The accelerating climate change involves an increasing number of extreme weather events with adherent additional issues. These extreme weather events lead to restrictions of usability and ascending running costs as a result of adjusted insurance costs. Therefore an efficient risk management system requires profound knowledge on potential natural risks under present and future climate conditions. The actors of the housing and property industry suffer by a lack of solid information on identification, analysis and assessment of climatic risks. Taking this additional information into account is of immense importance not only for their investment decisions but also for the insurance companies and regional planning authorities. This paper presents an approach of a climate impact risk assessment for the property market. The research comprehends an intensive evaluation of existing tools on risk assessment, insurance data and projections from climate models. The majority of existing risk assessment tools is accounting potential losses of a single climate impact and on a spatially highly aggregated level. By contrast, this paper contributes a multi-hazard risk approach on the property level. The analysis of potential risks combines separate methodologies for estimating the local hazard and building vulnerability (building-specific damage functions) in order to identify the monetary damage for each climate impact.