Warning issued to anyone thinking of buying a more affordable country home: These areas could soon be uninsurable

Daily Mail​

16 hours ago

Australians thinking of moving to a regional area are being cautioned to check first whether their affordable dream property could turn out to be uninsurable.
Young workers priced out of buying in Australia's increasingly unaffordable capital cities are looking to regional areas to secure a house, especially if they can work from home.
But buying regional real estate presents some issues much less likely in a big city, such as the risk of floods or bushfires.
Last month, 16 local government areas in the NSW Hunter and on the state's Mid-North Coast were declared natural disaster areas after floods triggered 6,000 insurance claims - 80 per cent of which were for damaged homes.
The Climate Council has warned that up to half of the homes in these areas are at a high to moderate risk of being affected by a natural disaster.
This will lead to insurance premiums rising to levels where they are unaffordable for the average-income earner, with premiums of $30,000 no longer considered unusual in areas located near rivers.
Of Australia's 10 zones most prone to a natural disaster, seven are in regional areas.
In NSW, five regional areas north of Sydney are in the high-risk category, along with northern Victoria, southern Queensland and areas around Brisbane, Adelaide and Perth.
Economist Nicki Hutley, a consultant with the Climate Council, said the risk warranted a serious revision of any plans to move to those areas, regardless of how cheap the land may appear to be.
'They need to reconsider moving to some higher-risk regional areas,' Ms Hutley told Daily Mail Australia.
'This is a really hard message to sell but we want people to really understand what is the risk.
'The answer may not be "don't move there", the answer may be that community infrastructure reduces the risks significantly.'
Maitland, in the NSW Hunter Valley, is Australia's fifth most popular local government area for internal migration, based on Commonwealth Bank customer data provided to the Regional Australia Institute.
The Mid-Coast council area, covering flood-ravaged Taree, was 13th on the list for relocators, and was recently soaked with 500mm of rain in just four days.
Both of these council areas, with population centres along a major river, fall within the federal electorate of Lyne.
Climate Council mapping showed a whopping 45.7 per cent of homes in this electorate were at a moderate to high risk of natural disasters.
They are also near the Labor-held Hunter electorate where 50.3 per cent of properties are at risk, with 12.9 per cent at high risk.
Port Macquarie, which also suffered from recent flooding, is eighth on the list of popular regional locations for those moving from another part of Australia.
This part of the NSW mid-north coast falls within the Nationals-held seat of Cowper, where a majority or 57.2 per cent of homes are at risk of a climate hazard.
The Tweed council area, on the NSW far north coast, was 15th on the list of relocation hotspots, and falls within the Labor-held seat of Richmond where 47 per cent of properties are at risk, including 28.9 per cent at high risk.
On the NSW South Coast, the Shoalhaven area was the seventh most popular spot for movers, and fell within the Labor-held seat of Gilmore where 36.9 per cent of properties are at risk.
The Climate Council also listed 10 federal electorates where average, insurance costs are more likely to be unaffordable, because damage from natural disasters was likely to cost one per cent of a home's value in repairs.
'Uninsurable is saying that the premiums are at such a level that a person on average income could not possibly afford them and/or insurance companies have pulled that product from the market,' Ms Hutley said.
'Sometimes there are areas where house and contents insurance is available but not for specific kinds of risks like flood or fire because the area is considered too risky for the insurance company.'
Port Macquarie, which also suffered from recent flooding, is eighth on the list of popular regional locations for those moving from another part of Australia. This part of the NSW mid-north coast falls within the Nationals-held seat of Cowper, where a majority or 57.2 per cent of homes are at risk of a climate hazard
Seven out of 10 of these hotspots were in regional areas, where it would be unaffordable to insure homes and businesses.
'Clearly, people move there because property is cheaper and it's not just because of climate risk,' she said.
'As the events recur, that is likely to have further impact on property prices.'
Lismore, on the NSW far north coast, is particularly affordable after a series of devastating floods, having a median house price of just $472,923, based on CoreLogic data.
This is less than half the national house price of $898,604.
'People expect they were snapping up a bargain, that they would take on the insurance risk themselves,' Ms Hutley said.
The city is also in the federal Nationals seat of Page, where 51.8 per cent of properties are at risk, with 16.9 per cent deemed high risk.
This makes regional living a particularly fraught decision for many people unless they were able to spend tens of thousands of dollars on raising the level of their house.
'You don't want to be buying a house in an area where you know there are designated risks of flooding and you're one block back from the river that's got no levees or flood protection unless you're able to do something with the property,' she said.
'That's obviously very expensive and not everybody can do that type of thing.
'Clearly, climate change is exacerbating - what we're now calling "unnatural disasters" and particularly flood risk is getting worse so there are areas where people are still moving to which, if not today, then certainly within the next couple of decades; they're facing significantly elevated risk.'
Areas of Australia deemed high risk in 2025
The Climate Council has named 10 federal electorates most at risk of flood or bushfire damage, with seven of them in regional areas
1. RICHMOND: Justine Elliot's Labor seat on the far north coast of New South Wales where 28.9 per cent of properties at a high risk with 31,564 in this category
2. NICHOLLS: Sam Birrell's Nationals seat in northern Victoria where 25.5 per cent of properties at high risk with 26,055 in this category
3. MAYO: Rebekha Sharkie's Centre Alliance seat in the Adelaide Hills where 17.5 per cent of properties at high risk with 20,177 in this category
4. BRISBANE: Madonna Jarrett's Labor seat in south-east Queensland where 12.8 per cent of properties at high risk with 18,878 in this category
5. PAGE: Deputy Nationals leader Kevin Hogan's seat on the NSW north coast where 16.9 per cent of properties at high risk with 18,636 in this category
6. MARANOA: Nationals leader David Littleproud's seat in southern Queensland where 13.7 per cent of properties at high risk with 18,499 in this category
7. ROBERTSON: Gordon Reid's Labor seat on the NSW Central Coast with 14.7 per cent of properties at high risk with 14,063 in this category
8. BULLWINKEL: Trish Cook's Labor seat on Perth's eastern outskirts with 15.6 per cent of properties at high risk with 12,719 in this category
9. DOBELL: Emma McBride's Labor seat on the NSW Central Coast with 13.9 per cent of properties at high risk with 12,569 in this category
10. HUNTER: Dan Repacholi's Labor seat west of Newcastle with 12.9 per cent of properties at high risk with 12,363 in this category