Saturday, October 18, 2008

Your money or your home

Extract from http://www.theage.com.au/environment/rising-sea-could-flood-700000-homes-20081016-52es.html

 

MORE than 700,000 Australian homes are vulnerable to rising sea levels, with up to $150 billion worth of homes, property and infrastructure at risk of seawater inundation, a parliamentary inquiry has heard.

Almost all Australians will be affected by rising sea levels, according to the Federal Government's Department of Climate Change.

"Eighty per cent of the Australian population lives in the coastal zone, and approximately 711,000 addresses are within three kilometres of the coast and less than six metres above sea level," the department said in a submission.

The Intergovernmental Panel on Climate Change predicts sea levels could rise between 0.18 metres and 0.59 metres over the next 100 years.

But even a small rise will dramatically change Australia's coastline, the department warns. "It is estimated that erodible coasts will recede one metre for every one centimetre rise in sea level. Storm surges will exacerbate coastal erosion."

Meanwhile, Insurance Australia Group has said billions of dollars in property, homes, businesses and public infrastructure are vulnerable to sea inundation. "Preliminary estimates of the value of property in Australia exposed to this risk range from $50 billion to $150 billion. The figure depends upon the extent of sea-level rise assumed and the effectiveness or otherwise of potential mitigation measures," chief risk officer and group actuary Tony Coleman told the inquiry.

And coastal property owners who have insurance for buildings may still be millions of dollars out of pocket if their land is swamped or swept away.

"In coastal locations, land value can form a significant component of a property's overall value," Mr Coleman said. "Whereas the value of coastal buildings may be protected to some extent by insurance, the land value of properties is not insured at all. Accordingly, where land is inundated or eroded by rising sea levels, coastal landowners and lenders in the banking and finance sector face significant losses."