Concerns over how climate change may impact real estate values have been percolating for years now. Many of the markets thought to be the most vulnerable to changing weather patterns are vacation towns, especially in coastal regions. But while waterfront properties threatened by sea level rise get all the attention, real estate markets in mountain towns also face uncertainty.
Often associated with clean, crisp air, mountain towns are popular vacation home destinations. Jackson Hole, Wyoming, a wealthy mountain town situated at the base of the Teton Mountain range, has long been a popular haunt for America’s elite, with some nicknaming Teton County the “billionaire wilderness.” The trend of high net worth individuals flocking to Jackson Hole exploded during the pandemic. Not only did the town see increased second home sales, values shot through the roof.
Real estate prices threaten long term residents
Long time local, nurse and owner of Remedie IV Therapy, Ali Kalenak is concerned how escalating housing costs could price much of the community out of Jackson. “We know many long time locals, including physicians and professionals who have been in the Tetons since the 1970s, who are concerned that Jackson is becoming a town only for the ultra-wealthy. People are worried that housing costs will force them out. Restaurants don’t have servers, there aren’t enough nurses. People can’t afford to live here. When you see double wide trailers popping up on Zillow for 1.8 million dollars, it’s not exactly a welcome mat for working people.” Kalenak said in a recent interview.
Although the Tetons may be the most extreme case, the problem of affordability in the mountains isn’t limited to Jackson. Vacation home sales across the country have increased over the past year as the pandemic gave people the freedom to work remotely. Like in Jackson Hole, rent and home values have spiked in some Colorado ski towns due to greater second home purchases.
Wildfire smoke is getting worse
However, there is an ominous trend looming in Jackson this summer – the usual glorious views of Grand Teton haven’t been visible for much of July as smoke from wildfires in California, Oregon, and Idaho has rolled in like a bad dream. Climate change has come to Jackson Hole.
While the pandemic fueled real estate craze has led prices for a 120 acre ranch as high as $65,000,000 in Jackson, climate change may pose a threat to the future of the market.
Multiple fires are currently burning in the western U.S. The Bootleg Fire in Oregon is the largest, covering nearly 400,000 acres which is larger than the size of New York City. As the western United States continues to experience higher rates of drought and wildfires, popular mountainous destinations like Teton County, Wyoming, are experiencing lower air quality due to smoke.
Jackson Hole’s new smoke season
Usually reserved for much later in the season, this year Jackson’s “smoke season” has come early. Extreme drought and fear of wildfires caused fireworks to be canceled across the west. By some estimates, Denver is unsafe for outdoor activity for 40 days in the summer due to ozone concerns. And with wildfire activity only increasing as a year over year trend, smoke may continue to fill the skies as the fires linger to Jackson’s west. Other western U.S. mountain towns have experienced similar phenomena. Some places in Colorado, including ritzy Aspen, has also seen smoke from fires in the northwest.
While wildfire smoke is especially concerning in the west, haze from these fires has affected air quality across the country, including on the east coast thousands of miles away. With wildfires predicted to increase in intensity and frequency, real estate markets in places previously considered safe from the impacts of climate change now seem vulnerable.
The presence of smoke in Jackson Hole may be due to severe weather patterns exacerbated by climate change. Because fire season in the northwest usually starts in the late summer, the smoke observed in Jackson Hole arrived earlier than in other years.
Wildfire smoke has been trending upwards in Jackson Hole for several years, mainly due to increasing droughts. Rain can help smoke dissipate, so summer storms may provide some relief. However, the region is predominantly dry during the summer, so smoke will likely plague the region until the fall.
Apart from health risks, wildfire haze also affects the aesthetic quality of mountainous destinations, obstructing picturesque views that attract visitors. For mountain towns where the view is a significant part of the experience, as it is in Jackson, this may further dissuade people from renting or buying vacation homes.
Air quality impacts property values
Air quality is a strong indicator of real estate prices, especially in urban environments. A study from the MIT Sustainable Urbanization Lab demonstrated that higher real estate prices were associated with lower levels of pollution from nearby cities. Likewise, according to a study from the National Bureau of Economic Research, air quality regulations generated by the Clean Air Act led to decreased air pollution and increased house prices in counties where they were implemented during the 1970s’ and 80s’.
When asked whether his clients were concerned with climate change and the growing prevalence of smoke in the region, Jackson Hole’s leading real estate broker, long time local, and founder of Prugh Real Estate, Greg Prugh said it is definitely on the minds of buyers. “Most buyers want to be at the top of the watershed with access to clean water and fresh air. There is a consideration that if California, Oregon and Idaho are going to be on fire every summer, maybe we go to Europe.”
The bottom line
When smoke is an isolated incident that blows in for a few weeks at the end of summer it’s easy to look past.
But what happens if 2021 becomes the new norm and smoke season lasts from July through October in towns like Jackson and Aspen? Will people continue to pay well over 1,000 a square foot for property in a region covered in smoke during high season?
Will Jackson Hole continue to be a popular destination for weddings with the iconic mountain views lost to the haze?
The jet-set crowd may think they can head to Europe, but no region is untouched by climate change. The new summer smoke season in Jackson is a harsh reminder – there is no planet B.