The top 10 Australian locations at highest flood and bushfire risk
A new report finds higher flood and bushfire property premiums are leaving more homeowners and investors struggling to insure their assets
3 min
More extreme weather events are affecting property values and home insurance costs, with a new report highlighting the impact of bushfire, riverine flooding and coastal erosion risk on homes and the need for buyers to assess disaster risk in their purchasing processes.
The 2024 Perils Report from Domain Research has found there is a direct relationship between the value of a home and its susceptibility to natural disasters. It revealed that 5.6 million Australian homes are at risk of bushfire — almost half of the entire residential housing stock. More than 32,000 homes, or 0.3 percent of stock, have high bushfire risk ratings. The researchers estimate that a home’s value decreases by 2 percent with every increase in its bushfire rating.
The report also found that 953,000 homes, or 8.1 percent of housing stock, face flood risk. Almost 141,000 homes have a high risk, and for every percentage point increase in the risk of a 50-centimetre flood, a property’s value drops by 0.8 percent. About 160,000 homes are within 150 metres of the coastline, and about one in 10 are at risk of erosion. However, the report finds there is no significant price impact given buyers place a high priority on waterside locations and views.
“This report is almost like a snapshot in time, looking at what is that landscape currently today, but we know that these natural disasters are escalating because of climate change,” said Domain chief of research and economics, Dr Nicola Powell. “The impacts in the future could [be] greater, impacting more homes and communities.”
Domain Research said evaluating a property’s risk is increasingly important for buyers. Home purchasers can access information from local councils and state governments, and some information may be included in the contract of sale. Buyers can also pay for a risk report to be done.
A recent report by the National Housing Supply and Affordability Council described climate change as an ‘emerging trend’ affecting values and insurance costs. “The price differential between flood-affected and non-flood affected homes has been estimated to be up to 35 percent a year after a flooding event,” the report said. “Furthermore, the RBA estimates around 7.5 percent of properties are in areas that could experience price falls of at least 5 percent due to climate change by 2050.”
The report said more than one million households are struggling to afford home insurance today, and more homes are uninsured as a result. The Insurance Council of Australia (ICA) says premiums are rising due to the impact of more severe natural disasters and a significant increase in construction costs that have gone well above the rate of inflation, making repairs more expensive.
The ICA said four declared insurance events in 2022 alone resulted in 302,000 claims costing $7.28 billion in insured losses. Six billion was from a single event – the Northern NSW and South-East Queensland floods – which was the second costliest insured event in the world that year and the costliest insured event in Australia’s history.
ICA CEO Andrew Hall says governments at all levels need to invest in more protection measures to mitigate the impact of extreme weather, thereby helping to keep insurance premiums lower.
“Governments must also amend land use planning legislation to include a mandatory requirement for planning approvals to consider property and community resilience to extreme weather, and improve building codes so future homes are made more resilient,” Mr Hall said.
Top 10 areas with the highest chance of a 50cm flood per year
1 Ballina NSW 3.9 percent
2 Tweed Heads South NSW 3.7 percent
3 Grafton NSW 2.7 percent
4 Coonamble NSW 2.3 percent
5 Tweed Heads NSW 2.2 percent
6 York-Beverley WA 1.9 percent
7 Maclean-Yamba-Iluka NSW 1.9 percent
8 Lismore NSW 1.8 percent
9 Tingalpa QLD 1.7 percent
10 Far South West QLD 1.6 percent
Source: Domain Research
Top 10 areas with the highest bushfire risk (out of 10) per year
1 Upper Yarra Valley VIC 7.7
2 Ashendon-Lesley WA 5.5
3 Mount Dandenong-Olinda VIC 5.4
4 Ettrema-Sassafras-Budawang NSW 4.6
5 Mount Wellington TAS 4.3
6 Glen Forrest-Darlington WA 4.0
7 Bilpin-Colo-St Albans NSW 3.9
8 Calga-Kulnura NSW 3.9
9 Deua-Wadbilliga NSW 3.9
10 Belgrave-Selby VIC 3.8
Source: Domain Research
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Kit Braden, an executive at French beauty empire L’Occitane, has spent every winter for the past 13 years at the stone vacation home.
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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.
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