This would have catastrophic consequences for hundreds of thousands of Australians living along coastlines and waterways.

In 2009, more than a decade before the IPCC report, the federal government’s now-dissolved Department of Climate Change published a report measuring the risk to Australia’s coastline — the first and only time it did so for the entire nation.

The report identified between 157,000 and 247,600 individual residential buildings at risk of inundation if sea levels were to rise by 1.1 metres. The replacement value for these houses, they estimated, was up to $63 billion.

Rogers, who has been leading a residents group agitating for a wall to be built to protect the coastline from further erosion, sees his home, and those of his neighbours, as the “first line of defence” against rising sea levels.

“We’re working really hard to try and work with the council or the government to come up with potential solutions that protect not only us but all the infrastructure behind us,” he says. “Obviously I want to protect the home, but I also want to protect the beach.”

He hopes any protective action taken in Wamberal — “if we can do things right” — could act as a blueprint for other coastal towns feeling the impacts of climate change. “It’s not just us,” he says. “The exposure is massive, really massive, and concerns are simply growing.”

How big is the problem?

Australia is a nation built on the ocean, literally and figuratively. More than 80 per cent of the population already lives within 50 kilometres of a coastline and the idealised beach lifestyle occupies a prime position in Australia’s national psyche.

And with the rapid rise of remote working, forced by health measures introduced during the pandemic, executive director of the Australian Coastal Council’s Association Alan Stokes predicts the number of people seeking a slower pace and water views is only set to grow.

“We’re going to notice a big difference in the findings of the 2021 census,” he says. “I think we’ll find that population levels in coastal areas — particularly those within, or a little beyond, commuter distance from the capital cities — are going to see enormous growth.”

This is despite “at least a metre [of sea-level rise], probably more” already locked in, according to David Wainwright, a coastal engineer of almost 25 years. “The thing is the timing: if it’s going to affect your property in 100 years, is that something you worry about now?”

The impacts of sea-level rise will not be limited to beachfront homes, but also properties in low-lying areas around estuaries or lakes. They are at risk of what’s called coastal inundation. “As the mean sea level rise goes up in the ocean, you’re also going to have the water level going up inside the estuary by a similar amount,” Dr Wainwright says.

It’s this latter group that will experience more damage in the coming decades. “This is a creeping issue that over time is going to inundate more and more frequently — and for certain properties, it might get to the stage where your property might be inundated by tides several times a year, even more. How are we going to manage that?”

Stokes believes the gradual creep of climate change has lured home buyers into a false sense of security. “There’s this perception that the worst of it will be felt in 2100, so someone buying a house now in an area that’s likely to be impacted by 2100 is saying to themselves ‘well, you know, that’s so far in the future it probably won’t affect me now’,” he says.

“But there will be increasing impacts during the period leading up to that.”

If home-buyers aren’t worried, the nation’s financial institutions certainly are. In September, the Reserve Bank of Australia released a report warning property values in climate change hot spots could soon take a hit, leaving banks vulnerable in the case of default. 

It warned that about 3.5 per cent of dwellings in Australia already fell under the international definition of “high-risk”, but that long-term climate change risk wasn’t being reflected in property values. South-east Queensland and northern New South Wales had the largest number of homes at risk of coastal inundation, the report found.

“If current values do not fully reflect the longer-term risks of climate change, housing prices could decline, leaving banks with less protection than expected against borrower default,” it said.

What it means for property buyers

When it comes to the impact of climate change on the property market, Claire Ibrahim, a director at Deloitte Access Economics, says the Reserve Bank is right to expect material declines in housing prices over time in high-risk regions. 

But, she adds, this is largely separate from how buyers will value property in the short term.

“Because people don’t have the information at the moment that clearly tells them with a level of certainty how it will change potentially for the negative because of climate, I think they do assume that it will hold to an extent,” she says.

“You have homes that reflect exactly the value of what people are willing to pay for them, but is it the right risk equation within that? No, it’s probably not. But would you call it overvalued? No, not necessarily. Because you could, in theory, sell it tomorrow and still make money from it.”

But eventually, as banks increasingly start to factor climate risk in, high insurance premiums will force buyers to reconsider the value of a property. “It really does alter the equation of how we value living by the water,” Ibrahim says. “And it starts to change the assumption that probably holds true for now that these properties will always maintain or increase their value.”

When will that tipping point come? Climate analyst Karl Mallon has set about trying to answer that question. His company, Climate Valuation, seeks to provide data on the actual risk of climate change to property buyers and the banks that lend to them.

Up until now, he says, damage from sea level increase has been relatively rare. That’s because most buildings have been constructed above the current sea level and set back from the coastline, forming what he describes as a “buffer”.

He believes the impact of sea level rise will be mild for the next two or three decades, after which coastal inundation will steadily worsen. “Coastal inundation will be one of the worst impacts [from climate change] we’re facing in Australia,” he says.

Should we reconsider coastal living?

According to the experts, this comes down to timing and whether the long-term risk is worth the short-term benefits of living by the water.

“Time really matters,” Ibrahim says. “When [people] make decisions, it can be really difficult to factor in time and risk in a way that’s meaningful for how you value things.”

While the impacts are already being felt in some areas, such as Wamberal, it is harder to quantify in regions where the danger is less obvious. 

By Climate Valuation’s measure, about one in 20 properties are at high risk of flooding and coastal inundation. Dr Mallon predicts this could increase to one in 10 properties over the course of the century.

Without major works to protect them, these properties face the possibility of becoming uninsurable. “You’re going to have people sitting on a house which they can’t defend, they can’t insure, and they can’t sell,” he says.

Governments across the world have embarked on large-scale engineering works to stop water encroaching on properties, but Dr Mallon believes Australian governments are less likely to go down that route because many at-risk areas have small populations relative to the high cost of intervening.

“In the end, there will be suburbs that will be untenable in this century,” he says. “It’s likely state governments and councils will just give up.”

Meanwhile, Dr Mallon recommends prospective home buyers research whether a property is in an at-risk area, and if it is, make sure their insurance policy covers flooding and inundation — often described as “actions of the sea”.

But after a quarter of a century surveying Australia’s coastlines, Dr Wainwright argues we must shift our thinking. “A lot of it has to do with this assumption that property is permanent,” Dr Wainwright says. “When you’re talking about the coastline, that’s not the case.”