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theLONDONpost   Monday September 1 2014

OH, YOUR INSURER DOESN’T LIKE YOU TO BE BESIDE THE SEASIDE

Even though you have saved for years to buy your dream home, your home contents and/or building insurance company would rather you didn’t have a home beside the seaside. Whereas banks would once mortgage even dilapidated properties with a sea view because the land value alone would protect their investment, these days such sites are no longer mortgagable.

The challenges of climate change have raised questions about the most basic of property investment assumptions, and raised fears about the outstanding loan books of many, if not most, banks and lending institutions. In most of the developed world property on the waterfront- ocean and river- has always been the priciest.

The financials, though, are convoluted. For tax reasons even the very rich often have mortgages on even their least expensive properties, in other words if anything goes wrong the lender will be left holding the baby. Many people who invested in property pension schemes, either individually or through managed funds, face ruin.

The storms that ravaged the South of France this summer were severe enough to destroy many houses but the problems were compounded when waves – of heights unprecedented in a Mediterranean summer - ceaselessly pounded the cliffs carrying the only access roads into the most prestigious estates.  In most cases these roads were private so government, at all levels, has no responsibilities and to offer assistance to the richest and most polluting segments, of society would in the words of an anonymous French official, “prompt large scale disorder”. In many cases grand houses which stand commandingly on headlands and cliffs are now isolated and deserted, like castles and strategic fortresses from earlier centuries.

The chaos on the Cote d’Azur has been followed by similar problems in California, Italy, Spain and Greece. The world’s most desirable real estate is having a mark down.

Mediterranean coastal areas are in an unexpected double bind. Storms coming from the sea have been even more violent than was anticipated and are occurring in the summer months, traditionally only a few isolated thunderstorms broke the monotony of the busy the dry season. Similarly, storms coming from the hinterland have surpassed even the direst projections.

These intense summer storms are particularly destructive in the financial sense because harbours are full. Large yachts probably won’t sink or be written-off but the damage they sustain can be expensive. Small craft have been destroyed in huge numbers. Onshore damage has been on a massive scale as the chairs and tables of pavement cafes became missiles which have killed several and maimed many. The damage to buildings and vehicles has also been unprecedented. The cost far exceeds damage sustained in all previous winter storms, when many premises would be shuttered and visitor numbers very low.

Although rainfall totals over much of the developed world have surprised scientists by remaining fairly consistent, the patterns of precipitation have changed dramatically, but particularly so in the developed world. (Although many dismiss this as simply too much data from the West and too little from the developing world.)

Coastal data from the Mediterranean basin and the coastal North and South America have shown that wet season rainfall has plummeted by as much 80% in some locations while dry season rainfall has increased by up to 3000%, admittedly at many sites the figures start from a very low base. The most dramatic changes have been recorded in Chile, where the southern coast (Patagonia) is a tinder-box as the northern coast (the Atacama) is receiving levels of rain never seen. Geologists know this area has been an extreme desert for at least 10 million years.

Some scientists think that by concentrating on land-based solutions we overlooked the damage to the oceans, which by their very nature, could not be explored properly and this has left us with a grasp of climate change even less thorough than has been supposed.

A recent UN report showed that Interior stations of North America and Europe  at least 100KM from the coast annual rainfall totals were 94% to 107% of long term historical averages but the number of wet days had decreased dramatically.

Some locations in Hungary and Germany are now averaging a wet day about every 10 days when previously there would have been rain every third or fourth day. Farmers and their crops are struggling to adjust, and that one wet day in ten is often destructively torrential. Scientists say this explains the frequency of flooding and crop damage, and confirms anecdotal evidence. 

The new conditions aggravate soil erosion and flooding as rivers repeatedly break their banks after each intense rainfall rather than flow steadily. Several Danube tributaries have changed course so often in the past three years that in parts of Hungary cartographers can’t keep up with changes. Although rivers can and do change course naturally, it has never happened with this frequency and been so widespread. In some places local reservoirs have been contaminated and even destroyed as perimeter walls were overwhelmed by floodwater.

Across the world, and throughout history, most communities owe their origin to being on or near a river, or where one meets the sea so it is only a matter of time before the very grave ramifications have to be addressed. Since many expensive coastal properties have been built to maximise views, they have been  constructed in locations where they are now prey to flooding as water surges off hilly terrain, just as the winds have ripped off the roof. The new property location of choice: an unassuming house on a flat featureless plain above the level of seas, rivers and lakes.