Property buyers are still interested in coastal properties despite the threat of climate change, with coastal properties remaining among the “hottest of hot commodities,” according to Quotable Value (QV).
Scientists expect climate change to increase sea levels by at least 10cm and likely even more over the next 20 years, which will increase the frequency and severity of coastal flooding in New Zealand and could lead to over 10,000 uninsurable homes by 2050.
Despite the sea-level threat, QV’s latest report revealed that coastal properties are still in demand and expected to remain that way for the foreseeable future.
QV property consultant Jarrod Hedley said residential house values have continued to skyrocket over the last six months, particularly on the eastern side of the Coromandel.
“Though we’ve seen the most growth at the lower end of the market in coastal areas, there remains strong demand for higher-value beach-front property,” Hedley said.
Property consultant Derek Turnwald added that demand for coastal property also remained strong in the Bay of Plenty.
“Auctions and open homes continue to be well attended, with homes generally selling well above seller expectations. I do expect things may cool slightly when the LVRs take effect once more, but demand will likely remain high on the coast this year. People want to live near the water,” he said.
QV general manager David Nagel warned Kiwis to be more aware of the risks before purchasing coastal properties.
“We Kiwis love the ocean. We want to be in it, on it, and near it – especially this time of year. But it seems that we have failed to heed the warnings for far too long now, and I still don’t think that the message is getting through to most people yet. The sea level will rise, and the odds of more extreme weather events are set to rise alongside it,” Nagel said.
“Do your due diligence. Don’t just adopt that classic Kiwi ‘she’ll be right’ mentality – actually look very carefully at the risks, one of the biggest being the ability for coastal homeowners to get access to full insurance cover in the future.”