The threat of natural disasters is unlikely to change the locations where Australians want to live, with Ray White’s chief economist highlighting the bush and the coast would remain desirable.
Speaking at the Ray White Group’s flood information webinar Monday night, Nerida Conisbee used the 2020 bushfire ravaged town of Mallacoota as an example of what could happen in a property market devastated by Mother Nature.
“Having a look at Mallacoota, that was one of the worst impacted by the 2020 bushfires but prices have increased by 70 per cent,” she said.
“One of the things with a lot of places that are impacted by natural disasters is that they are places people want to live.
“People like being in the bush, they like being near rivers (even though) rivers flood. People like being near the beach and we have problems with erosion.
“There are two competing issues – disasters cause a lot of problems, but people still want to be there.”
Ms Conisbee said it was hard to “untangle” the full impact of the disaster long-term, but she expected southeast Queensland and northern NSW to recover and remain popular places to live.
“Mallacoota is such a good example as this was a town completely decimated, but people rebuilt,” she said.
“They got the community back together and it is a desirable place to live. It’s the same with a lot of the Brisbane areas that have been impacted.
“People want to be near the water and that really hasn’t changed for a very long time.”
Ms Conisbee said after the 2011 floods there were fewer homes for sale and while prices fell in some areas, they climbed in others.
In data Ray White released it showed the median price in flood-affected suburbs such as Milton fell 22.4 per cent, to $620,000, in the year after the 2011 floods but six years later prices had risen 20.7 per cent to $965,000.
“It is quite variable, but within about three years we started to see property markets return to normal,” she said.
“What we found following the 2011 floods was that all homes had returned to their previous values.”
Other property market challenges identified in the webinar included the worsening rental crisis and the escalated costs of building materials and supply chain issues.
Ms Conisbee said tenants in flooded areas had to search for new homes in already tight rental markets.
“We are already seeing evidence of a rental crisis and it is primarily because people are displaced out of their homes,” she said.
“It does vary, depending on where you are, but obviously Lismore has a high proportion of the population that can’t live in their properties.
“Brisbane is a little bit different partly because there is more accommodation, but the challenge for Brisbane at the moment is that there are very low vacancy rates.
“We’ve just come through an enormous level of interstate migration, international borders are reopening and it’s very hard to find rental accommodation.”
Ms Conisbee said in areas like Lismore, people may have to seek accommodation well away from the town.
“What we saw during the bushfires in 2020 was that in a lot of regional areas, people had to travel well over 100km to accommodation because there was such a shortage,” she said.
When it comes to rebuilding flood damaged towns, Ms Conisbee said another challenge to clear was rapidly rising building costs.
“We do have supply chain blockages, we have a shortage of labour and there’s lots of challenges around demand for workers,” she explained.
“We have the Olympic Games coming up, and there’s a lot of building taking place then. So not only are we heading into this situation of rental challenges, we’ve also got a lot of building challenges and Brisbane is going to have to rebuild a lot of properties.
“We’re also going to see a lot of regional areas having to rebuild and it is going to get expensive.”
How you can help:
Ray White has kick started its fundraising platform, Beyond the Bricks, which was born out of the 2020 bushires. The White family, on behalf of Ray White, will donate $50,000 to kick off the flood appeal.
Go to www.raywhite.com/beyondthebricks/ to donate to GIVIT, The Salvation Army, St Vincent de Paul’s flood appeal, WWF’s emergency flood appeal which supports the rescue and care of flood affected animals, or the Red Cross.