Climate Refugees and their Impact on the Global Real Estate Industry

The recent wildfires in Los Angeles, California, have left an indelible mark on the region. With more than 150,000 families evacuated, 12,000 mansions, more modest homes and businesses consumed by the flames and at least 30 fatalities, these fires have been one of the most destructive in the city's history. The combination of extreme droughts and strong gusts of wind, known as "Santa Ana winds," has exacerbated the situation, turning many into climate refugees.

Climate refugees are people who are forced to leave their homes due to extreme weather events, such as fires, floods, hurricanes, and droughts. In the case of Los Angeles, hydroclimatic volatility, characterized by abrupt oscillations between torrential rains and severe droughts, has been key factors in the spread of fires. This phenomenon is directly linked to global warming, which has increased the frequency and severity of these climatic events.

The climate refugee crisis in Los Angeles not only affects people directly affected but also has repercussions in other regions of the world. Many cities inside and outside the United States will see an increase in demand for real estate due to the new housing needs of climate refugees coming from California and other cities affected by natural disasters. These phenomena will have a significant impact on the global real estate industry, which will have to adapt quickly to meet the needs of these new residents.

Many climate refugees will seek refuge in cities inside and outside their countries, for example, in cities in Panama, such as Panama city, Coronado, the Panamanian Pacific Riviera and Boquete, where the supply of housing needs to increase to meet the growing demand. In addition, the Panamanian government will be forced to implement policies to facilitate the integration of climate refugees, promoting in conjunction with real estate companies, tax incentives and visa and retirement programs for the purchase of homes by foreigners.

However, this increase in demand will also create challenges and opportunities for the local and global real estate industry. The lack of adequate housing for these groups of high-end buyers and competition for properties globally will lead to an increase in land and housing prices, making it more difficult for local residents to access housing. In addition, in the case of Panama, the infrastructure of cities such as Panama, Coronado and Boquete will have to adapt to accommodate the growing population and its commercial demands, which will require significant investments in public and private services.

Despite these challenges, the real estate industry has demonstrated remarkable resilience and adaptability. The arrival of climate refugees will spur the creation of new housing projects and encourage investment in infrastructure, benefiting both new residents and the national economy. In addition, the cultural and professional diversity that the new neighbors will bring will continue to enrich the local communities, promoting a more inclusive and dynamic environment.

The recent fires in Los Angeles and the global climate refugee crisis will have a significant impact on the global real estate industry.  While the situation presents challenges, it also offers opportunities for development and the creation of a more inclusive and resilient environment. The adaptability of the global real estate industry and government policies to support climate refugees will be key to facing this new reality and ensuring a better future for all.