“My house may well become uninsurable”: Gippsland homeowners come to terms with flooding reality

An increasing number of Australian homes are facing a severe risk of flooding, with property values around the country dropping by $42.2 billion according to a new report from the Climate Council and property data firm PropTrack.

The difference in storms: Venus Bay resident and South Gippsland councillor Sarah Gilligan said she’s noticed storm surges getting higher for about six years now. 

Two years ago, she witnessed  water rise over the top of the Venus Bay levee wall, which runs the length of the first and second estates of the peninsula, for the first time.

Now, Gilligan is coming to terms with the possibility of not passing on her house to her kids.

🗣️ “The idea of passing the family home onto the children, I've had to let go of that,” Gilligan told the Monitor. “Our Australian identity is so wrapped up in this laid back coastal lifestyle, and it's under threat.”

What happened: Floods have wiped out $42.2 billion from the value of Australian homes, according to a new report by the Climate Council and property data firm PropTrack.

• Out of the two million flood-prone houses across Australia, at least 70 percent have had their values reduced by flood risk.

• As of April 2025, the median value of a typical home (three-bedrooms and two-bathrooms) in a flood-prone zone was $75,000 less than the same home without flood risk.

• One in six Australian homes are at risk of flooding - that’s 11.7 million residential properties.

• In Victoria, 8.7 percent of homes (255,704 properties) are at risk.

Climate Council Analyst Ben McLeod told the Monitor: “Australian communities are built on rivers, lakes and on the ocean. One in six homes around Australia are at some risk of flooding, and Victoria is no different.”

What’s making floods worse? Dr Milton Speer, a meteorologist at the University of Technology Sydney, told the Monitor that rising global temperatures were the cause of increased severe flooding events.

🗣️ “The oceans are heating up, the air is heating up,” said Speer. “That means there's more moisture that can go into the atmosphere. That means you can get more moisture falling out as rain.”

No perfect solution: McLeod said solutions need to be tailored to each community. For some areas, the installation of levee walls and storm surge drains could protect homes, but for communities where homes have become unlivable and uninsurable, property buybacks should be considered.

• What are property buybacks? A voluntary government program where homeowners in flood-prone areas sell their homes to the government at pre-flood market value.

• 🗣️McLeod said: “Increasingly, we're seeing entire communities which are becoming uninsurable. While many people do have insurance for their homes, often people who are most at risk of disasters either can't afford insurance or can't get insurance at all.”

💰 The cost of adaptation: A report by Deloitte Access Economics estimates that inaction on climate change could shrink Australia's GDP by 6 percent by 2070, which is a loss of around $3.4 trillion.

🗣️ “It's substantially more than the cost of cutting climate pollution, switching to renewables, reducing our emissions across Australia and across the economy,” McLeod said.

For Venus Bay, Gilligan said she would like to see:

• The planting of salt marsh and mangroves, which would help absorb most of the storm surges.

• The raising of the road leading onto the Venus Bay peninsula to stop it becoming an island whenever there’s a flood.

• The state government invested in a Coastal Hazard overlay.

What’s a coastal hazard overlay? A government planning tool that identifies areas at risk of hazards like flooding, tide inundation and erosion, helping to ensure new development is safer.

🗣️Gilligan said: “We need to address the fact that coastal hazards are a combination of flooding, erosion and isolation. It's not just as simple as a flood overlay.”

Venus Bay is worth it: Gilligan has asked herself multiple times whether she should sell up and move to an area not at risk of flooding.

•  “I want my children to grow up here,” said Gilligan. “That's of more value to me and hopefully to them and their lives than having the cash of the family home.”

• “My house may well become uninsurable. I don't know what's going to happen with that in the future, but I'm up for it, because I think this is an extraordinary place to live.”