Climate Change to Cost $25 billion in Damages to Australian Households
Published 6:01 am 22 Oct 2021
Is your suburb at risk of facing climate-related damages in the future?
Over the past twelve months, Australia’s property market has accelerated at the fastest annual pace since 1989. Sydney has led this growth with a staggering 24.4% increase in dwelling values over the past 12 months, followed closely by Brisbane’s 20.7% increase.
Clearly, Australians have flooded into the property market amid this record growth and historic low interest rates. However, there’s one thing that many people might not have considered: The impacts of climate change upon Australia’s property market.
A new study carried out by Climate Valuation found that the number of high-risk suburbs in Australia will double over the next 80 years due to an increase in severe weather events.
The study, carried out for news.com.au, found that the number of high-risk properties will climb from 491,000 this year to 646,000 in 2050. That number will more than double by 2100, reaching 1.1 million homes.
By this point, the yearly damage bill is estimated to be a total of $25 billion across the country. This would be a 257% increase from the $7 billion in household damages seen in 1990.
These risks could impact hundreds of thousands of Australian households and are said to be largely climate-related, including floods, bushfires and other extreme weather events which are expected to increase in frequency due to climate change.
“Unfortunately a lot of families will be put in harm’s way and will pay through higher insurance costs as floods and bushfires worsen,” Climate Valuation’s CEO Dr. Karl Mallon told news.com.au.
A major concern, according to Dr. Mallon, is that home insurance may either drastically rise or become unavailable for Australians in high-risk areas.
“We are coming across many cases of homeowners who have been faced with unaffordable or unavailable insurance.”
“This is a very dangerous situation because it exposes families to financial ruin if their home is damaged during an extreme weather event,” said Dr. Mallon.
This in turn, is posing a question to new homebuyers to seriously consider the impacts of climate change in their suburb prior to purchasing a home.
“Currently in Australia there is no national program to assist vulnerable communities in managing the physical impacts of climate change,” Dr Mallon said.
“Without appropriate support, it feels like people are being left on their own to prepare for the physical risks and financial fall out.”
The Climate Valuation analysis looked at 14 million properties throughout Australia and evaluated their risk of fires, coastal inundation, cyclones, flooding and soil subsidence.
Are you protected?
With most of Australia having just left lockdown, it can be easy to simply focus on making the most of our newly-acquired freedom.
However, if the pandemic has taught us anything, it’s that our lives can change at any moment, and things can worsen very quickly. Add the looming threat of climate change to the equation, and it’s safe to say that there are no guarantees in life.
As such, you’ll want to consider how vulnerable you are, should a life-changing event occur.
Should you suddenly have creditors harassing you for money or assets, what would your recourse be? Do you have a plan in place? Or would you simply have to forfeit all of the assets you’ve worked so hard to accumulate?
If you don’t have a plan in place, you might want to listen up.
Here at DG Institute we developed the Master Wealth Control program to ensure that Australians received the protection they deserved when facing financial hardship.
If you’re concerned that your home, or your assets could be at risk should things turn belly-up, then our Master Wealth Control program might be for you.
You May Also like to Read
Will this highly contagious strain of COVID-19 affect property values? The Australian property market is currently...
Will this highly contagious strain of COVID-19 affect property values? Just one month after roughly half of Australia...
Across the country, Australian properties are being sold for multiples of what they were purchased for just several years...
Home to more than two million people, Perth is the sunniest city in the world, enjoying more sunlight year-round than...
Australia could see an additional intake of two million new migrants over the next five years. Will this be the catalyst to...
Things are about to get even hotter in Australia’s record-breaking property market. If the growth seen over 20-21 in...