White Rock Lake Fire (Vernon Matters Photo)

By Kevin Rothwell

Insurance an issue

Climate change could impact Okanagan real estate

Jul 7, 2022 | 7:00 AM

A new report suggests the increase in major natural disasters will have an impact on where Canadians want to call home in the next five years.

Okanagan rivers, lakes and forests have been considered assets in attracting residents to move here. The nearly annual threat of flooding in the Okanagan, and last year’s massive White Rock Lake fire, have more and more people concerned about calling certain locations home.

A recent survey conducted by Leger on behalf of RE/MAX Canada found that 61 per cent of Canadians believe real estate is the best long term investment they can make. Canadians do not see this changing over the next five years. However, when looking ahead to their future in 2027, 57 per cent of Canadians say that a key factor that will impact their housing location is climate change and the potential of weather-related events.

An additional 49 per cent are concerned about the impact on their existing neighbourhood in the next five years.

Part of the equation is the ability to get insurance.

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According to RatesDotCa, home insurance premiums rose 140 per cent in Alberta since 2011 and jumped 64 per cent in Ontario.

“The immediate financial risk climate change is having on the housing market is widely visible today, as six per cent—and up to 10 per cent—of homes across Canada are already uninsurable for flood risk. Moreover, as we continue to build on floodplains, that number will grow,” Kathryn Bakos, Director of Climate Finance and Science at the Intact Centre on Climate Adaptation, stated.

A survey by the centre done following a flood shows that six months after a flood event, it has a big impact on the market, including an 8.2 per cent reduction in average sold prices, a 44.3 per cent decrease in listings and 19.8 per cent more time on the market.

The problem can be mitigated, but it is going to take money and a lot of it.

“The immediate need to allocate a minimum of $5.3 billion a year to the restoration and modernization of Canada’s green infrastructure, such as wetlands, grasslands and brown infrastructure, including sewage systems, among other initiatives, must become a priority for all levels of government,” Dr. Mike Moffatt, Senior Director of Policy and Innovation at Smart Prosperity Institute said.

The entire report is available by clicking on this link.