IDEAS home Printed from https://ideas.repec.org/a/aza/jbsav0/y2022v11i3p250-258.html
   My bibliography  Save this article

Residential property evaluation and climate change modelling

Author

Listed:
  • Lawson, Michael

    (Property Risk Inspection, UK)

  • Winser, Graeme

    (Property Risk Inspection, UK)

Abstract

Climate change poses a first-order threat to human civilisation and governments across the world, their agencies and big and small corporations have announced climate emergencies and made commitments towards net zero emissions across a range of target dates. Regulators have tasked financial institutions in the insurance and banking sectors to expose their existing portfolios and lending practices to scrutiny as to resilience levels, preparedness and knowledge base relating to property risk level impacts from existing and emerging climate-driven property perils. The scope of these investigations has mobilised a range of consultancies and emerging climate service providers (CSPs) to support regulatory oversight and provide modelling input relative to expertise in a range of environmental issues driven by climate change. The combination of global emission scenarios and general circulation models (GCMs) with existing expertise in modelling real-world problems such as flooding, coastal erosion, storm and subsidence has produced forward-facing forecasts across the natural physical and societal risks. The regulatory results at portfolio levels have necessitated financial institutions scenario planning down to property address levels to assess overall scale of impacts and the possible provisioning requirements against multiple probabilities over decadal horizons out to 2100. These high-level assessments will in the next few years feed directly into valuation and property investigation for origination loans and the cash buyer. CSPs will inevitably seek to monetise a return on their investment in modelling for financial institutions and their unique exposure to portfolio-level provisioning as consultants to these organisations reporting to the regulator. How this data at a property level is interpreted spatially and temporally will be a unique new challenge for chartered surveyors and other property professionals within lending institutions and within the conveyancing sector. This paper looks at the development of portfolio-level climate change reporting, the scientific basis for decisioning and the real risks of assuming that scenario precision produces accurate climate outcomes at the property level. A range of evolving rule sets are proposed for lenders, valuation specialists and conveyancers to ensure reporting is fit for intended purpose.

Suggested Citation

  • Lawson, Michael & Winser, Graeme, 2022. "Residential property evaluation and climate change modelling," Journal of Building Survey, Appraisal & Valuation, Henry Stewart Publications, vol. 11(3), pages 250-258, December.
  • Handle: RePEc:aza:jbsav0:y:2022:v:11:i:3:p:250-258
    as

    Download full text from publisher

    File URL: https://hstalks.com/article/7378/download/
    Download Restriction: Requires a paid subscription for full access.

    File URL: https://hstalks.com/article/7378/
    Download Restriction: Requires a paid subscription for full access.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    data; property risk; climate change; data curation; data storage; data vendors; climate service providers; general circulation models; precision; accuracy; triage; lending;
    All these keywords.

    JEL classification:

    • R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aza:jbsav0:y:2022:v:11:i:3:p:250-258. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Henry Stewart Talks (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.