This report highlights how climate change is affecting the property sector in Sweden, focusing on increased risks because of extreme weather such as floods and storms. Examples from recent years, including storms Hans and Babet as well as the floods in Gävle and Kävlingeån, underline the significant financial consequences for both municipalities and private property owners. The report notes that new EU laws increase demands for sustainability reporting and climate risk analysis, which will also impact financing. Many of today's physical risks can be reduced with relatively modest efforts, such as adapting existing buildings. The National Expert Council for Climate Adaptation emphasises the need to move from identifying problems to implementing solutions. The report concludes that if property owners do not act proactively, society risks long-term economic losses, lower property values, and reduced financing opportunities. The main responsibility for climate adaptation lies with property owners, but the lack of knowledge is often considerable and cooperation is needed to address the challenges. The project does not cover general societal solutions or policy proposals not directly linked to the possibilities and responsibilities of property owners. A vision for climate-adapted properties aligned with EU regulations is proposed to increase resilience and reduce vulnerability to future climate-related events. The report presents a roadmap for property owners in their climate adaptation work, demonstrating how the process can be divided into five main areas that together form a systematic long-term strategy for reducing climate-related risks.

In 2021, heavy rainfall in the Swedish city of Gävle caused severe flooding, affecting many properties in the area. To date, insurance companies have paid more than one billion Swedish kronor in compensation to affected property owners. The distribution of damage was uneven, making it clear that the individual preconditions of each affected property had a substantial impact on the degree of damage suffered. This sparked a discussion about the risk of natural disasters on mortgages and insurance policies in light of climate change, and whether more consideration should be given to the individual conditions of a property rather than relying on general area-based risk maps where all properties in one area are assessed similarly. In many cases, small measures can have a substantial effect on the degree of climate-related hazards tied to natural disasters. In Sweden, the responsibility to undertake measures to decrease such risk today lies with the property owner. However, many owners lack relevant information on how to assess their property’s risks to natural disasters as well as hands-on recommendations on how to mitigate those risks. At the same time, financial institutions, insurance companies and many other actors face new European and national legislation that requires them to understand, measure, remedy and account for their risks related to this area. In the case of lenders assessing the risks to their collateral at an individual property level, the ability to get an overview is limited. At best, risks can be described on an area level only, meaning that the individual conditions of the property are being not considered. In this report, we have explored whether a standardised classification system, a so-called climate resilience certificate (CRC), that outlines the individual risk exposure of a property could offer a potential solution to this problem – and if it could be both easy to use by private homeowners and meet the needs of industry stakeholders. To test our idea, we conducted a case study by applying the system to the events that took place in Gävle in 2021. We suggest further work on the feasibility of a preferably European-wide, threestep model of a CRC taking into consideration all acute and chronic physical climaterelated hazards described in EU law. The first step of the classification is based on a databased screening tool resulting in a preliminary assessment, ranging from green to yellow to red. The second step is an in-depth assessment conducted by a certified climate expert who collects data through an on-site inspection of the property and/or an examination of documentation, resulting in a classification ranging from A to G, together with suggestions on climate adaptation measures that could be taken to decrease risk. In the third step, the data is made available to the property owner and, to a limited extent, other relevant stakeholders. A CRC could facilitate and improve climate adaptation efforts made by property owners by (i) making it clear, on an individual property level, which owners should take measures (and in certain cases get support) to decrease risk and (ii) creating an incentive to take these measures from lenders, insurance companies and investors.

Climate resilience certificates – a standardized assessment of climate-related hazards in real estate

In 2021, heavy rainfall in the Swedish city of Gävle caused severe flooding, affecting many of the real estates in the area. As to date, insurance companies have paid more than one billion SEK in compensation to the affected property owners. The distribution of damage was uneven, making it clear that the individual preconditions of each affected property had a substantial impact on the degree of experienced damage. This sparked a discussion about the risk of natural disasters in the light of climate change on mortgages and insurances and whether more consideration should be given to the individual conditions of a property, rather than relying on general area-based risk maps where all properties in one area are assessed similarly. In many cases, small measures can have a substantial effect on the degree of climate-related hazards tied to natural disasters. In Sweden, the responsibility to undertake measures to decrease such risk today lies with the real estate owner. However, many real estate owners lack relevant information on how to assess their property’s risks to natural disasters as well as hands-on recommendations on how to mitigate that risk. At the same time financial institutions, insurance companies, and many other actors face new European and national legislation that requires them to understand, measure, remedy, and give an account for their risks tied to this area. In the case of lenders assessing the risks to their collateral at an individual property level, the ability to get an overview is limited. At best, risks can be described on an area level only, meaning that the individual conditions of the property are being not considered. In this report, we have explored whether a standardized classification system, a so-called climate resilience certificate (CRC), that outlines the individual risk exposure of a real estate, could be a potential solution to this problem – if it would be both easy to use by private homeowners and meet the needs from professional actors. To test the idea, we have performed a case study applying the system to the events in Gävle 2021. We suggest further work on the feasibility of a, preferably European-wide, three-step model of a CRC taking into consideration all acute and chronic physical climate-related hazards described in EU-law. The first step of the classification is based on a data-based screening tool resulting in preliminary assessment, ranging from green to yellow and red. The second step is an in-depth assessment conducted by a certified climate expert who collects data through an on-site inspection of the property and/or an examination of documentation, resulting in a classification ranging from A to G, together with suggestions on climate adaptation measures that could be taken to decrease risk. In the third step, the data is made available to the real estate owner and, to a limited extent, other relevant actors. A CRC could facilitate and improve climate adaptation efforts made by real estate owners by (i) making it clear, on an individual property level, which real estate owners ought to take measures (and in certain cases get support thereto) to decrease risk and (ii) creating an incentive to take these measures from lenders, insurance companies and investors.

Climate change and associated risks create high costs and must be considered in both city planning and construction. The increasing recognition of threats influences how investments are made both in future projects and in the valuations of existing assets. A feasibility study was performed on how a climate resilience certificate (CRC) can create a tool for better valuation for contractors, and property owners to increase efforts regarding climate change adaptation, easy-to-understand benchmarks for climate resilience of properties for comparability, and to reduce uncertainty if insurance coverage can be guaranteed. This study focuses on a risk classification, tested, and evaluated in a Swedish case study on a property level, with emphasis on heavy rain, as a base for a potential CRC. The study discusses the benefits and drawbacks of on-site assessments versus what is digitally available. Furthermore, this study also highlights vulnerabilities of the evaluated buildings, and where the focus should be placed concerning climate adaptive measures. 

Klimatet förändras och vi ser effekterna av det redan idag med allt fler extrema väderhändelser. Klimatanpassning handlar om att planera och arbeta för att förebygga negativa effekter av klimatförändringar och extrema väderhändelser som redan är här idag och som kommer i framtiden. Att arbeta med klimatanpassning och att höja robustheten på en byggnad, en fastighet eller ett område kan innebära många olika saker. Det delade ansvaret kan försvåra genomförandet men det finns också förutsättningar för att arbeta effektivt. Med ett helhetstänk, flexibla lösningar och förståelse för robusthet kan vi komma väldigt långt. I denna exempelsamling lyfter vi fram ett antal olika åtgärder som kan bidra till att förebygga att skador uppstår eller som ökar motståndskraften mot klimatförändringar och extrema väderhändelser. Urvalet av exempel har gjorts utifrån relevant forskning och erfarenheter. De åtgärder som lyfts fram har genomförts i befintlig miljö. Exempelsamlingen syftar till att motivera och inspirera till att genomföra fler robusthetshöjande åtgärder i vårt samhälle och det är upp till var och en att bedöma lämplighet för respektive plats och åtgärd. Det finns även många fler åtgärder som är möjliga att genomföra. Därför har vi i slutet av den här rapporten ett avsnitt där vi hänvisar till andra inspirerande exempelsamlingar och åtgärdsbeskrivningar.