I am a recent LA home buyer. I made the brilliant financial move of purchasing in May 2008. When we bought our house, we made an implicit bet that Los Angeles would remain a great place to live and work. I have my fingers crossed. Home prices in Los Angeles are more than double those in other major cities. In 2008 the average single-family home in Los Angeles County sold for $578,000, and 10 percent of the homes in the county sold for more than $1,000,000. There are more than 32,000 zip codes in the United States. Of the top 200 zip codes ranked by average housing price in the entire United States, 45 percent are in California, although only 20 percent of the nation’s population lives in California. Twenty of the top 200 most expensive U.S. zip codes are in Los Angeles County, including Beverly Hills 90210.
These high prices are not due to the inherent productivity of working in Los Angeles. In fact, my time spent outside in the sun while in Los Angeles has probably made me a worse economist. Economists at the University of Chicago claim that Chicago’s bad weather raises their productivity by eliminating the option of playing tennis. Los Angeles’s great quality of life is what drives up local home prices. The average buyer of a single-family house in Los Angeles County in 2008 paid $324 per square foot of interior space. If LA’s quality of life declines, my life savings will unravel.
Climate change can’t alter the blue skies or access to the beach and mountains, but it will pose four tangible threats: The summers will grow hotter, the air will be smoggier, there will be more fires, and there will be much less water. In other words, as we saw in chapter 3, climate change is going to shift the competitive landscape of cities, and LA is going to take a hit. And the poorest parts of LA are going to be hurt worst of all. But there’s a lot we can learn from an examination of LA’s probable future—especially the basic lesson that prices matter. Other cities take note. Our tour of LA will show us the key role that market prices of both electricity and water will play in determining this city’s fate. In addition, this case study will highlight how government policy (such as binding land use zoning and caps on water prices) can unintentionally hinder adaptation.
Will LA Lose Its Cool?
California’s cool summers and warm winters distinguish its cities from the rest of the nation. Southern cities are hot and humid in summer. Midwestern and Eastern cities are cold in the winter and humid in the summer. Nobody wants to be in Houston or Washington, D.C., in the middle of summer. In contrast, in Los Angeles today the average temperature in July is 74 degrees F, with little humidity.
Climate change will likely degrade LA’s ideal climate. Leading climate researchers have developed two different models that allow them to predict each U.S. county’s average temperature and rainfall by month for the years 2070 to 2099. Two computer models, with the catchy names CCSM Model and H3A1FI Model, bear bad news. Los Angeles County is predicted to be 13 degrees F warmer on average in July by 2070. The problem for current LA real estate owners (such as myself) is that a fair bit of the value of their assets (my home) rests on the fact that relatively few areas in the United States feature warm winters and cool summers. In the future LA’s climate will look like Jacksonville, Florida’s, climate today. This is bad news for my housing wealth.
You might try to soothe my spirits by reminding me that all cities will face hotter summers. Unfortunately for you, dear reader, I know the lost art of statistics. I have crunched the data to study the relationship between county home prices and county climate conditions. What jumps out from this analysis is that areas with cool summers and warm winters command a huge real estate price premium. There are relatively few such areas (mostly in California), and they are in high demand. Climate change is predicted to strip away much of California’s climate uniqueness, and therefore will strip away the housing price boost that comes with that climate. Mean July temperatures close to 90 degrees F by the late twenty-first century will force down relative real estate prices to reflect underlying changes in climate amenities.
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17 Comments
Add CommentI really wanted to like this piece, but it relies too much on intellectual shortcuts. The anecdote about the writer's mother-in-law on page 7 is a prime example. The water agency is trying to cut water use by incentivizing saving, but the writer believes this is silly because his MIL got a check for cutting her water usage, when in reality she was overseas and hence her water use fell. Are you really using a single anecdote that relies on an outlying phenomenon (i.e., not everyone can afford to spend a whole month traveling in Italy) to dispute the generally accepted notion that financial incentives can influence human behavior? The same goes for example of how Candy Spelling's giant estate pays less per gallon of water used than the writer does. Is one rich person's anomalous water bill enough to toss out the entire idea of tiered rates? Finally, your view of L.A. is way too westside-centric. You should hang out in some other neighborhoods a bit. The fact that a handful of UCLA students won't venture downtown proves nothing. Oh, and you misspelled the mayor's name.
Reply | Report Abuse | Link to thishttp://www.notenoughtowaste.org/notenoughtowaste/Headwaters.html
Reply | Report Abuse | Link to thisSome of your facts are not totally correct, we do get 15 inches of rain not 11 and not everybody wastes water, check out more facts about Securing LA water future here. http://www.notenoughtowaste.org/notenoughtowaste
Reply | Report Abuse | Link to thisCurious. So Cal is heading towards the coolest summer on record. July 8 saw the lowest maximum high in 132 years of record keeping in San Diego. Lowest record highs breaking decades old records have occurred continuously this summer on the California coast. Didn't we have record snows this winter back east? And where exactly are the hurricanes the ;ast four years now? Certainly makes on wonder how this stuff is measured.
Reply | Report Abuse | Link to thisBTW, everyone talks about how bad LA/OC is but nobody seems to be leaving, apparently even you. That's why the song say's 'We love it!'. After an awesome day today around the pool it should be obvious to the most effete Eastern snob.
Reply | Report Abuse | Link to thisIndeed, climate is an important factor for attracting people living in LA, but LA has many different characteristics from other region for its charm. It's really interesting that the author discusses the climate issue on an economic view.
Reply | Report Abuse | Link to thisAs one lucky enough to take my family and escape the cesspool of SoCal, I can't imagine that anyone still believes the false claims that LA is some sort or nirvana or desirable in any way. The traffic alone is reason enough to hate the place. I live 65 miles from the nearest freeway.
Reply | Report Abuse | Link to thisMost of the article is about water. Typical LA attitude that the author thinks that water should be taken from farmers for the lawns of the city. What don't you understand about the fact that WE GROW YOUR FOOD!
Now that LA is just Tijuana Norte, I'm very happy that I don't live in Mexifornia anymore.
What is the reasonable/fair method of calculating the appropriate use of energy/resources by nation states on planet earth??? Should it be based on the resources used per person or per square mile???
Reply | Report Abuse | Link to thisHow may we support you? Your invention is desperately needed.
Reply | Report Abuse | Link to this"Climate change cant alter the blue skies or access to the beach and mountains, but it will pose four tangible threats: The summers will grow hotter, the air will be smoggier, there will be more fires, and there will be much less water."
Reply | Report Abuse | Link to thisOk, is it just me or how bi-polar is this statement? sure, whatever we do here won't affect the fact that there are stars overhead either.... WTF? worry, but, don't worry? at some point, this "writer" needs to take a stand and quit taking the middle road. its not all about profit. at some point, you have to take a stand - that is, if you believe in something.
the author is talking like a fool, you should pay more attention at how to exist in the earth longer, if you are all gone with the bad climate economy is zero, all things are 000000000
Reply | Report Abuse | Link to thisI take issue with a couple points. One is on the subway where you say it will have 200,000 riders a year. The current subway has 150,000 riders per day not per year, so basically you calculation is off by a factor of 365. That $1,000 taxi ride just went to $3.
Reply | Report Abuse | Link to thisAlso, you claim that the skies will become smoggier. As you correctly stated, air pollution has dropped dramatically in the last 30-40 years and continues to drop. With the advent of electric cars and more technological improvements this will likely continue, but you suddenly give a more doomsday scenario because of warmer weather. Also, warm weather is not necessarily a producer of smog. Los Angeles suffers from an inversion layer of cooler air below warmer air. If the cool air does not come in from the coast this inversion does not happen so warmer days are not necessarily the most smoggy. This is often true today as the warmest days are generally not the smoggiest inland necessarily.
Hard to get past the first page of name-dropping and tourist advertising. Kahn and his wife must be up for the next Real Housewives of L.A. Who the hell would read his stupid bool?This guy is just putting lipstick on a pig and calling it beautiful.
Reply | Report Abuse | Link to thisThe real issue is...where do these giant metro areas like L.A. and Vegas get their water? The reality is that they steal it from others. By doing so they desire to create a serfdom where the lowly rural inhabitants only exist to serve their city-dwelling masters. The most valuable commodity is fresh water.
The only way to stop the madness is to abandon the growth economy model and concentrate on a sustainable future. Mexifornia (nice one, notslic) is the present model for a failed state, with its $20 billion deficit and plan to again start handing out IOU's for the services it purchases. When it goes down the toilet, it will only end up where all the rest of its sewage does...3 miles out to sea.
"The summers will grow hotter, the air will be smoggier, there will be more fires, and there will be much less water", Matthew Kahn is talking Global Warming. The evidence for GW has evaporated. LA has bigger problems than climate.
Reply | Report Abuse | Link to thisWhen I arrived in SoCal 1972 from the NorthEast, I watched heat-infused sunsets, drank margueritas, ate chile rellenos, and thought I was in heaven (and picked up a BSEE). Having been to all 50 states and many countries, I still think SoCal is heaven. Please consider Shakespeare by the beach or opera at the Dorothy Chandler, cocktails at the Biltmore or dinner at the old train station. Take in the LA Marathon or volunteer at a soup kitchen. What's a little humidity? It's a very elastic and accepting social environment. And, very adaptable. Being rich is not how much you have but how little you need.
Reply | Report Abuse | Link to this"Almost everyone in Los Angeles was not born here."
Reply | Report Abuse | Link to thisHint...the vast majority of the Hispanic kids are NOT ousiders. They were born in greater LA. As were Vietnamese. Chinese, etc.
There are also outright twisted facts about precipitation, recent tremperatures, etc.
Are there no editors at Scientific American to weed out fluffy nonsense articles full of errors?
To me, it's clear that LA is not going to "adapt" so much as how the rest of the world is going to need to change. Different technologies and the use of completely clean power generation (say fusion in the future) could in fact make it very viable
Reply | Report Abuse | Link to thisWe'll see
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