PHOTO: Climate change effects everything, including house prices. FILE
The future head of Australia’s Reserve Bank issues a cautionary note to prospective homebuyers eyeing properties along the Gold Coast and idyllic coastal towns in New South Wales. In a recent climate change speech delivered in Canberra, Michele Bullock unveiled a concerning statistic: she indicated that approximately 7.5 percent of Australian homes are located in postcodes where the impacts of climate change could potentially drive property prices down by five percent or more by the year 2050.
Bullock presented her findings at the Australian National University, explaining that climate hazard data had been employed to quantify the expected rise in insurance costs resulting from climate-related damages, such as heightened flooding and more destructive cyclones. These increased costs were then translated into projected declines in housing prices. An illustrative color-coded map vividly highlighted the regions across the country most susceptible to these effects, with tomato-red areas encompassing the Gold Coast and Tweed Heads, signaling potential price drops of between five to ten percent over the next three decades due to flooding.
South of Brisbane, this region is particularly attractive to residents relocating from Sydney and Melbourne in search of a warmer climate, making southeastern Queensland the primary destination for interstate migration in Australia. Meanwhile, a significant portion of the New South Wales north coast appeared in pink on the map, signifying potential house price reductions of two to five percent. Notable pockets of tomato-red emerged around Byron Bay, Ballina, Lismore, and Grafton, all of which have grappled with flood damage in recent years.
A colour-coded map of Australia had tomato red areas around the Gold Coast in south-east Queensland and neighbouring Tweed Heads. Most of the New South Wales north coast was coloured pink, denoting house price falls of two to five per cent, with dots of tomato red at Byron Bay, Ballina and Lismore which have suffered from flood damage in recent years
The report mentioned that 90 percent of homes in the Victorian city of Shepparton could become uninsurable by 2030, and indeed, the city experienced severe flooding just five months after the report’s release, in October. Tomato-red markers also dotted the NSW South Coast, encompassing national park areas and outlying towns near Melbourne, Adelaide, and the Tasmanian city of Devonport. Mallacoota, located in Victoria’s northeast, was another featured area, having endured devastating bushfires in early 2020.
Sections of regional Western Australia appeared in maroon on the map, indicating potential price drops exceeding 10 percent. Geraldton, situated 400 kilometers northwest of Perth and susceptible to cyclones, was among these areas. Northern regions, including Carnarvon, were also marked in tomato-red.
Bullock acknowledged that the Australian Prudential Regulation Authority’s Climate Vulnerability Assessment indicated potential increases in losses on bank lending in the medium-to-long term, but she assured that these would not lead to severe stress in the banking sector.
However, she warned that climate change could exacerbate unemployment in specific areas of Australia. She pointed out that persistently higher unemployment rates could result if individuals were unable or unwilling to leave regions affected by extreme weather and resultant job losses. Bullock stressed that the impact of climate change could vary significantly from one region to another, potentially having a minor aggregate impact but causing extreme challenges for local communities.
Bullock had also previously suggested that the jobless rate would need to rise from its recent 48-year low of 3.5 percent to 4.5 percent for inflation to fall back within the Reserve Bank’s target range of 2 to 3 percent. She expressed this view during a June speech at the Australian Industry Group forum in Newcastle. Based on June’s labor force figures, achieving this would mean approximately 149,309 Australians losing their jobs by mid-2025, with unemployment in July already rising to 3.7 percent.
During one of her lectures, protesters confronted Bullock, objecting to her stance on employment, and handed her a giant JobSeeker check. They demanded an explanation for her assertion that 140,000 people should lose their jobs, arguing that the cost of living crisis stemmed from corporate greed.
Finally, a Climate Council report from the previous year had also predicted that 90 percent of homes in Shepparton, Victoria, would be uninsurable by 2030. Sadly, this prediction proved eerily accurate when, in October, the city faced a 12.2-meter flood peak, surpassing the flood levels recorded in 1974.
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