As Climate Changes, Time to Disclose Threats to Coastal Property Buyers?

As Rhode Island prepares for sea levels to rise three to five feet or more, as well as for more frequent and intense storms due to climate change, the state should anticipate a looming consumer rights issue.

Rhode Island’s coasts are home to many intergenerational properties, but the impacts that climate change will have on intergenerational ownership of coastal property are rarely, if ever, discussed.

This is understandable, perhaps, because many coastal homeowners today may not live to see the worst of the impacts. But their children and grandchildren will likely experience the brunt of sea-level rise and severe storms, inheriting coastal properties with sunken resale values.

Climate change poses a consumer rights issue that, if neglected, may well compromise current and future coastal homeowners’ financial expectations.

Today, when a prospective buyer looks at a house in Rhode Island, the homeowner-to-be has the right to know certain information about what could become their family’s largest asset.

The seller must disclose information concerning most of the house’s defects whether with the basement, the roof, the chimney, the electrical system, the air conditioning, or the plumbing.

Other disclosures are required for environmental concerns, regarding flood insurance information, wetland proximity, cesspools, radon, lead paint and hazardous waste.

There is an official form required for all disclosures of “deficient conditions,” approved by the Rhode Island Real Estate Commission. Rhode Island law defines “deficient conditions” as “any land restrictions, defect, malfunction, breakage, or unsound condition existing on, in, across or under the real estate of which the seller has knowledge.”

Crucially, the Rhode Island Real Estate Commission has the right to amend the disclosure requirements when there is a “determination that health, safety, or legal needs require a change.”

Rhode Island law explains that the Commission’s ability to amend the requirements should be “liberally construed,” allowing the Commission to amend when “other property information” comes to light.

Rhode Island’s Coastal Resources Management Council (CRMC), alongside the Department of Environmental Management, the Department of Health, and the Division of Planning, have begun to broadcast the serious health and safety consequences of climate change for Rhode Island.

The impacts will affect Rhode Island in a myriad of ways, compromising Rhode Islanders’ homes, businesses and ways of life. The Real Estate Commission is in a position to take notice, and recognize projected sea level rise on, in, across, or under a coastal property at or below five feet elevation as a “deficient condition,” worthy of disclosure.

Were the Real Estate Commission to amend its disclosure requirements to include sea level rise, for coastal homes at or below five feet elevation, it would protect Rhode Island families who may otherwise have expectations of passing on property to their children.

Additionally, the sea level rise disclosure requirement could influence the buying and selling of vulnerable coastal property without requiring any expensive government regulation.

To satisfy the requirement, the seller would only need to provide the buyer a map showing projected sea level rise impacts on the property, and perhaps information from CRMC about other impacts like more frequent and intense storms.

Skeptics may argue that sea level rise is too distant a threat to reliably project where impacts will appear. Indeed, most sea level rise modeling that has been done throughout Rhode Island has used a “bathtub” model (a digital elevation model unto which changes in sea level are projected) that has resolution limitations, preventing exact knowledge of where the ocean will end up.

But when the discussion is about a family’s largest asset, the bathtub model’s approximate projections of sea level rise should be enough.

Any responsible buyer, who hopes to one day pass on the coastal home to his or her children or grandchildren, surely wants to know whatever approximate information is available regarding risks to their family’s major investment.

Rhode Island, like the rest of the country, continues to learn about the long-term risk that sea level rise poses to our communities. Is it time that the Real Estate Commission requires the disclosure of sea level rise to prospective coastal homeowners?

— Dan Kopin