The increasing frequency and severity of extreme weather events are posing a significant threat to the Australian property market, particularly concerning insurance affordability and availability. A Climate Council report reveals over 2 million Australian properties face heightened insurance risk, with over 650,000 deemed "high risk." This alarming trend, illustrated by the story of a family in a disaster-prone NSW region, is impacting property values and long-term financial stability.
For Australian property professionals, this necessitates a crucial shift towards integrating climate risk assessments into due diligence and investment strategies. The report identifies specific "critical climate risk zones," highlighting the geographical concentration of risk. Experts urge proactive mitigation and adaptation measures, including government intervention and community resilience programs. Professionals must consider how to incorporate climate risk projections, enhance property resilience, and navigate the evolving insurance landscape to safeguard investments and ensure long-term sustainability in a market increasingly vulnerable to climate change. The future success of property investing hinges on addressing this climate emergency now.