Climate change could cost homeowners hundreds of billions of euros Economy

21 nov 2023 om 05:05

The consequences of climate change could lead to a significant decline in the value of Dutch homes in the future. Data collector Calcasa says this includes damage caused by floods and drought.

Researchers believe the risk of earthquakes could also play an important role. Although earthquakes are not caused by climate change, they can still have consequences, especially for homeowners in the north and southeast of the country.

Calcasa has estimated what natural hazards mean for the value of Dutch homes. This looked at how many homes were in areas at risk from bushfires, floods or earthquakes. The risk of foundation rot due to persistent drought was also taken into account.

The researchers then estimated the costs of the damage. For example, the cost of repairing rotten foundations is estimated at no less than 54 thousand euros.

Based on all these calculations, Calcasa estimates that the value of homes in the future would be 325 billion euros less without these risks. For reference, the value of all 8.2 million Dutch homes is approximately 3.3 trillion euros. So the potential loss of value is about 10 percent.

Floods are the biggest problem

The greatest risks occur during floods. Up to 3.7 million homes are at risk of damage from rising sea levels, heavy rainfall or rivers overflowing their banks. This concerns many homes because large parts of the Netherlands are low-lying and because many rivers flow through our country.

Especially in the center of the country and on the Wadden Islands, many homes can be submerged. Damage could reach 175 billion euros.

Earlier this month, the Dutch Authority for the Financial Markets (AFM) also cited the risks of climate change to the housing market. As far as financial control is concerned, homes should from now on carry a climate label, just like the current energy label. This would allow homebuyers to assess climate risks when purchasing and adjust their offers accordingly.

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Braeden Haige

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Climate change could cost homeowners hundreds of billions of euros Economy

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