Among the many issues associated with the drought (financial hits to the agricultural sector and the degradation of delicate ecosystems) is one that quite literally hits close to home. The lesser known drought-related detriment is the surprising decrease in property values.
How is it that a state whose water use is 80% accounted for by the agricultural sector (while being accountable for 2% of the state’s GDP) has a drought which effects individual property values? The issue is this: with a greater part of the US having one sort of dependency or another on California’s agricultural doings, it’s hard not to justify the seemingly excessive water usage. It’s a huge economic driver for California, and we’ve seen before how massive a hit the drought can cause for such an important part of our economy. That being the case, Governor Brown issued mandatory cutbacks of 20% or more from residential water users rather than the agricultural sector.
With that in mind, the financial impact of the drought has to go someplace, and unfortunately it has been delegated to individuals in California residences and their forever fluctuating property values. To find out more about this not-so-apparent connection, read here.
By: Jay Berstein