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Is your area vulnerable to property devaluation due to flooding? Recent research sheds light on how flooding impacts home values in various regions, and the findings are quite revealing.
In Queensland, the flood-prone suburbs of Chelmer and Graceville, located near the Brisbane River, have experienced a significant decline in property values. The report highlights that homes in these areas have seen a 10.6% decrease, translating to an average loss of approximately $303,000 in value.
Similarly, in western Sydney, properties in the neighboring suburbs of Pitt Town and McGraths Hill, situated in the low-lying Hawkesbury catchment, have not been spared. Homes in these areas have depreciated by 8.7%, equating to a reduction of about $363,500 compared to properties not at risk from flooding.
These statistics underscore a broader trend where increasing property prices have somewhat obscured the financial hit faced by homes affected by flooding. As one expert poignantly noted, the rise in house prices has masked the adverse impact on these flood-affected properties.
The lure of cheaper homes
However, McKenzie said the problem “compounds inequality”.
Former prime minister Scott Morrison inspects a flood-damaged property in Sydney’s McGraths Hill in 2022, where property values have since dropped by nearly 9 per cent. Source: AAP / Dean Lewins
“In some of these regions where we’ve identified the flood risk being really high, they’ve been inundated multiple times within a five-year period,” she said.
“People can become trapped,” she said.
Richer areas not immune
A damaged Putt Putt golf course at Mermaid Beach following ex-Tropical Cyclone Alfred in early 2025. Source: AAP / Dave Hunt
However, the report did find the drop in value was smaller in some of the more prestigious areas. Noosaville and Noosa Heads were two places where coastal vistas and an enviable beach lifestyle outweighed the risk of flooding.
“No matter what demographic the property is in, if your home is flood-affected, it has increased less than others.”
Who should pay the penalty?
“The government will need to buy back houses because it won’t be feasible to live in those locations anymore. Those costs should be absorbed by the whole community because people didn’t know that that was going to be the risk that they were exposed to.”
