The value of the popular coastal property market may start to slide with news that the Victorian Government is set to designate vast new areas of Victoria’s coastline as floodprone. This is in response to the findings of the Intergovernmental Panel on Climate Change and the CSIRO, which suggests planners should allow for a sea level rise of between 18 and 100 centimetres over the next 60 to 100 years.
The report, which is expected to be released some time in the next few weeks, will impact on proposed developments at Port Albert and Port Fairy, as well as Western Port towns of Tooradin, Warneet and Hastings. Developers may need to dramatically pull back on the amount of land they develop, and when you’re talking beachside, you’re dealing in big money.
Individuals like Kevin Reardon are paying the price. He’s already invested $400,000 in a block of land at The Honeysuckles, a beachfront development on Ninety Mile Beach:
“The Honeysuckles Estate is a purely residential subdivision (about 400 lots) behind the primary dune of the Ninety Mile Beach and contained on the inland side by the flood plain of Lake Reeve.”
– About The Honeysuckles
So with just the sand dunes on one side, and Lake Reeve on the other, The Honeysuckles seems particularly vulnerable to rising sea levels. On Tuesday the Wellington Shire Council is set to decide on whether to place a moratorium on all building development in the area, but such a stance is bad news for people like Mr Reardon:
“A moratorium is unacceptable. Buy me out or just leave me alone.
This is a knee-jerk reaction, but if they make this decision it’s going to hurt a lot of people. And right now, we’re in limbo. We can’t build, we can’t sell.”
– Mr Reardon
Whichever way councils like Wellington Shire go, they could be in trouble. If they allow developments to go ahead, they put themselves at risk of litigation in the future should sea levels rise or storm surges wash through the towns. On the other hand if they ban building developments, then current property owners face huge losses.
What will be the implications for other communities, big and small, around Australia? I’m particularly interested in what this might mean for low lying developments around the Gold Coast’s canals, and the Brisbane suburb of Raby Bay, where the possibility of cyclones is an added risk.To see a dramatic visual of what a 1 metre rise in sea levels might mean, check out this map, and zoom in on the south-east Queensland coast.
Back in 2006 former Queensland Premier Peter Beattie was asked about the issue of wave surges wiping out waterfront properties on the Gold Coast:
“Now I don’t want to be alarmist because, as I said, this isn’t going to happen tomorrow and people on the Gold Coast need to know that. This is a long-term strategy. We are going to do this modelling, we’ll be – this is a long-term strategy for modelling – we will ensure that the community’s are involved in it, people have some idea of what’s happening and over the next years, this is what we will do so that people understand the potential.”
– Peter Beattie, Lateline
I don’t think the issue of rising sea levels has yet impacted on the residential property market, but I reckon it’s got to influence things eventually. Governments, both local and federal, need to start preparing for the possibility of changes in our sea levels and weather patterns, and that means action is needed sooner rather than later. One day they’ll need to move on from modelling, and start making changes, and that’s when it’s going to start to hurt the electorate, and hence the ruling government, whoever that might be. And when real changes start happening, that’s when buyers, sellers, and real estate agents will start to pay attention, and we may start seeing some low-lying waterfront properties significantly drop in value.
Update: July 2, 2008
The Wellington Shire Council yesterday voted not to ban further building at The Honeysuckles, with a vote of 6 to 1 in favour of allowing owners to build on their land. However, the Council may consider changes to the building code, such as setting minimum floor levels. More than 50 protestors attended the meeting to voice their opposition to the ban:
“There is more at stake here than just liability for the council. You’re not just taking my right to build, you’re taking my dream, you’re taking my future, you’re taking all of our futures.”
– land owner Kylie Stolk
This is where it gets tough. People like Kylie, who purchased a block of land at The Honeysuckles at the age of 21, have invested heavily in land and houses. With the possibility of rising sea levels, councils and governments have to tread carefully along that fine line between the shattered dreams of homeowners, and legal issues around the protection of those same owners from potentially damaging sea levels.
Sadly what people living along the coast have to realise is that there is no insurance in such high risk zones for “actions of the sea” or “inundation from the ocean”. Because the current threat is not from sea level rise itself which is happening slowly. The major threat right now is from extreme weather events.
Small increases in sea level rise, combined with a warmer ocean, rising temperatures and other factors, can and has been increasing the intensity and frequency of cyclones and the storm surges (ocean inundation) that they bring (Hurricane Sandy is an example).
Insurance does not cover for storm surge or tidal surges or any action from the sea or sea level rise in these high risk coastal areas. They may have cover for tsunami, but a tsunamis are caused by earthquakes and are far less likely.
So any decent Government who cares about its people, should ban coastal developments, especially in these vulnerable locations. If you want to know what the likely threats are to your area, just look at your insurance policy and find out what they wont cover. You wont get earthquake cover in Christchurch or flood inundation insurance on the river edge in Brisbane either.
These warnings have been around for decades, sadly it is a case of buyer beware. Choice and the Climate Institute have just produced a report on this very subject called “Buyer Beware”.
The fact that they are uninsurable will effect their value anyway.
The social, environmental and economic ramification going forward will be massive for coastal communities.