Natural disasters are changing attitudes to long term property values
Australian property values usually rebound quickly after natural disasters, but not this time
2 min
Flooding is beginning to have long term effects on property values, a new report from CoreLogic reveals.
The East Coast Floods – One Year One report examined the impacts of the extreme weather events on the Richmond-Tweed area (also known as the Northern Rivers region) on the far north coast of NSW, as well as the Brisbane region in early 2022, which some described as a ‘rain bomb’.
The report, authored by Corelogic economist Kaytlin Ezzy, said while residential values were historically fairly resilient following flooding events, recovering within three to five years, the 2022 disaster had changed perceptions among homeowners and potential buyers.
“Attitudes towards flood-prone areas, and climate risk in general, are changing,” the report said. “Homeowners, lenders and insurers are becoming more cautious of the risks associated with climate change and are adjusting their risk premiums accordingly. For some impacted homeowners, the risk of another flood is likely to be top of mind, and we could see a number of residents accept government buy-back offers where they are available.
“For others, the increased costs of insurance could price out existing owners and dissuade new buyers from areas vulnerable to flooding.”
The report noted that while the Insurance Council of Australia had closed 80 percent of claims from the events, which are estimated to have cost $5.7 billion – Australia’s most expensive natural disaster on record – that was only part of the story.
“A sizable number of people are still waiting for building repairs to start, while other uninsured residents have been left with limited resources to undertake repairs,” the report said. “Government intentions around buy backs are still playing out and the number of post flood home sales is still low.
“The full impact of the floods won’t be known until these factors have played out.”
Using satellite imagery, CoreLogic has zeroed in on areas most affected by floods. Perhaps unsurprisingly, flood-prone areas such as South Lismore and North Lismore recorded flooding across 80.8 percent and 70.1 percent of properties respectively. The news was similarly grim in West Ballina, where 56 percent of properties were impacted.
However, areas considered low risk, such as Girards Hill (35.1 percent) and East Lismore (22.4 percent) were also heavily affected.
In the Byron Bay region, Mullumbimby experienced the highest numbers, with 17.4 percent of properties impacted by flooding.
The impact on values has been immediate, and not just in those areas directly affected by floods, CoreLogic data reveals.
“Mullumbimby recorded the largest 12-month decline nationally, down -30.1 percent, roughly equivalent to a $432,000 decline in the median value, followed by South Lismore (-27.0 percent), Ocean Shores (-26.8 percent) and Byron Bay (-25.4 percent). The other impacted suburbs saw values fall between -22 percent and -25 percent,” the report said.
“Interestingly, a number of suburbs that were relatively unimpacted by flooding also recorded significant declines. Values across Bangalow, Lismore Heights and Suffolk Park fell by -28.4 percent, -25.7 percent, and -24.3 percent, respectively, and East Ballina and Alstonville recorded slightly smaller declines of -20.2 percent and -19.6 percent.”
While it noted that reduced economic activity across the whole region was a likely contributing factor, the report said that the decline had been less in Lismore’s elevated suburbs of Goonellabah which recorded a milder -7.2 percent drop in values, as well as a number of surrounding farming communities where declines were less severe.
Rising rates, construction inflation and shrinking investor confidence are pushing Australia deeper into a dangerous housing spiral that monetary policy alone cannot fix.
Automobili Lamborghini and Babolat have expanded their collaboration with five new colourways for the ultra-exclusive BL.001 racket, limited to just 50 pieces worldwide.
Kit Braden, an executive at French beauty empire L’Occitane, has spent every winter for the past 13 years at the stone vacation home.
2 min
A historic Barbados estate with a 300-year-old villa and 11 acres overlooking the Caribbean Sea is now for sale with a guide price of $22.5 million.
The seller is Kit Braden, chairman of the U.K. branch of French beauty empire L’Occitane Group, whose family has spent every winter for the last 13 years at the island property, known as Fustic Estate.
“It’s very much a family house,” Braden said. “We love having a lot of people there. It’s a collection point to keep everyone together.”
The main villa dates to 1712, though it’s been reimagined and expanded substantially over the years.
It spans 13,000 square feet and features seven en suite bedrooms across three wings, as well as expansive verandas, stone courtyards and rows of louvered doors in gay Caribbean pastels.
In the 1970s, when the home was owned by Charles Graves—brother of British poet Robert Graves—it was reimagined by stage designer Oliver Messel, one of the foremost theater designers of the last century. Messel expanded the home, added a lagoon pool with a natural waterfall and other theatrical features, according to Braden.
“The whole place is a little bit magical,” he said.
The home sits about 350 feet above the water, and surrounded by lush gardens that slope towards the water.
“We look down through our garden—which is about 12 acres of tropical gardens and palm trees and wonderful old mahogany trees—onto the Caribbean,” Braden said.
He and his wife first saw the property on New Year’s Eve 2013, during a quick trip from where they were staying in Grenada.
The couple spent an hour walking the perimeter, some of it still untouched jungle, in the pouring rain.
“By the time we got back, I had fallen in love with it,” Braden said.
His wife, however, wasn’t so sure. But in Braden’s telling, a second visit in sunnier weather with two of their children brought her around.
“She had to be talked into that it was a jolly good idea; now she absolutely loves it,” he said.
When they bought the property, the edge that runs along the waterfront was a jungle, so they cleared the ridge and transformed it into gardens.
They also bought an additional sea-level parcel with two beach cottages, giving the property direct access to the water and the town below via a five-minute walk.
The property also has a 15-person staff, a reflecting pond, an outdoor pavilion suitable for yoga and a commercial grade kitchen that can serve more than 100 guests, according to a brochure from Knight Frank, which posted the listing in March. They did not provide further comment.
For Braden, the property is special because of its natural beauty, its proximity to the town of Saint Lucy and its history—which dates way way back to when the island of Barbados was first formed via tectonic activity.
“It was basically tectonic plates that collided about a million years ago so the seabed is the top of the hill,” Braden said. “We’re on coral rock.”
As a result, Fustic Estate includes an extensive network of caves that were likely used by the Arawaks, a Venezuelan fishing tribe that followed the fish to these islands about a thousand years ago.
“If the fish were good they’d camp here,” Braden said. “There’s evidence that they stayed there in those caves, they lived there in good winters.”
Now it’s someone else’s turn to live on the land shared by Arawaks, the plantation owners of 1712, Charles Graves and the Braden brood.
Formula 1 may be the world’s most glamorous sport, but for Oscar Piastri, it’s also one of the most lucrative. At just 24, Australia’s highest-paid athlete is earning more than US$40 million a year.
A bold new era for Australian luxury: MAISON de SABRÉ launches The Palais, a flagship handbag eight years in the making.
