Queensland’s Paradise Point is Australia’s suburb with most property value at risk from the effects of climate change on the nation’s coast, with NSW’s Cronulla and Manly, and Victoria’s Port Melbourne and Aspendale rounding out the top five.

Increasing storm surges and coastal erosion has the potential to impact $25 billion worth of Australian residential coastal property, CoreLogic estimates.

Its Coastal Risk Scores measure compounding storm surge erosion and change in coastlines, reflecting rising sea level trends, to calculate and assign a rating for 98% of Australian residential property. The common traits of the top 10 suburbs at risk were close proximity to the coast, low elevation, fastest coastal retreat figures and high property values.

“In the next three decades, coastal risk will crystallise, with the tangible effects of climate change already being felt in most parts of Australia,” CoreLogic Head of Consulting and Risk Management Pierre Wiart said.

Recent floods in Queensland and NSW were “a tragic but timely reminder of the untold devastation” extreme weather events could have on Australia, he said.

“This is leading to direct physical and financial consequences. Coastal risk has far-reaching implications for the country’s property market and its supporting financial sector, including property valuations, home loan viability and insurance premiums.”

Australia’s sea levels are rising at a rate higher than the global average and Dr Wiart says this “alarming” coastal erosion requires urgent attention as increasing coastal risk is adding pressure on insurance, and property owners face “ballooning insurance premiums and restricted insurance coverage, together diminishing their insurance affordability and protection of their significant assets”.

The Coastal Risk Score ranks properties from No Risk to Very High Risk - those which may be impacted by coastal retreat within the next 30 years and may also be at very high risk of significant storm surge impact.

More than 900,000 dwellings are identified as falling into one of four ‘at risk’ categories, with 12,694 houses and 9441 units categorised as being at High or Very High risk of coastal exposure, valued at $5.3 billion and $19.6 billion respectively.

Queensland has the highest concentration of properties at Very High risk for the number of both individual houses and units, reflecting the Sunshine and Gold Coast’s densely populated coastlines. NSW, Tasmania and SA also have a large number of individual houses classified as being at Very High coastal risk.

Paradise Point on the Gold Coast has 406 dwellings deemed most vulnerable, estimated to be worth $1.47 billion within just 6.4 square kilometres.

“No other suburb has such a high concentration of residential wealth subject to high coastal risk,” CoreLogic said. About 20% of Paradise Point’s housing stock is at high risk, equivalent to 40% of the suburb’s total residential value.

Cronulla, Manly and Port Melbourne also ranked highly, with around half a billion dollars in property value each at risk, due to high apartment values and density within close proximity to the coast.

CoreLogic Research Director Tim Lawless says a significant proportion of Australia’s property wealth is located in coastal, river and harbour front suburbs, a coastal living trend that had accelerated during a demographic shift in recent years in which more Australians were considering housing options outside of the capital cities.

This had seen the value of coastal properties accelerate significantly, with Sunshine Coast values jumoping by more than a third in the year to January.

“Working from home has been a catalyst of this trend with more people basing themselves in regional locations during the pandemic.”