Purchasing property in high-risk areas like bushfire zones always comes with both risk and reward. If you’re on the fence about the idea, discover how you can make your decision-making easier.
The 2019-2020 bushfire season in Australia was one of the worst we’ve seen in recent years. Reportedly, it razed nearly 13 million hectares of land just between October 2019 and February 2020.
Needless to say, bushfires have become a pervasive and costly menace in Australia. It’s especially true for homeowners and investors whose properties are in areas designated by authorities as bushfire zones. These zones are classified based on their susceptibility to bushfire incidents.
But it’s important to remember that no property is entirely risk-free. As such, it’s no surprise that there remains a market for buyers and investors interested in properties located in bushfire-prone areas.
And in this article, we’ll delve into the pros and cons of investing in such properties. This way, you could decide based on your personal circumstances and risk appetite whether the pros outweigh the cons.
The Pros of Buying Property in a Bushfire Zone
Pro #1: Lower Purchase Price
One of the biggest advantages of buying property in a bushfire zone is the potential cost savings. Properties in these areas tend to have lower purchase prices compared to those outside bushfire zones.
If you are on a tight budget, know that the perceived risk of bushfire incidents in bushfire zones allows better room for price negotiations.
Pro #2: Less Competition With Other Developers
The higher potential of bushfire incidents means there is often reduced competition among property developers in bushfire-prone areas.
As mentioned, savvy investors can negotiate better deals and secure assets at more affordable prices. But the reduced competition could also work in your favour.
With fewer property developers vying for land, opportunities to secure favourable properties increase. And this will allow you to capitalise on the potential growth of these areas in the future.
Pro #3: Market Demand For Scenic Areas
Despite the risks, there remains a demand for properties in scenic locations located in bushfire zones. After all, many property buyers are drawn to the picturesque landscapes and natural beauty offered by these areas.
The appeal of living in close proximity to lush forests, stunning coastlines, or sweeping valleys can outweigh the perceived bushfire risks for those seeking a lifestyle immersed in nature.
The Cons of Buying A Property in a Bushfire Zone
Con #1: Fireproofing and Maintenance Costs
Owning a property in a bushfire zone comes with many additional responsibilities. These include fireproofing the structure and maintaining the land to mitigate the risk of fire damage.
Fireproofing measures, such as installing ember-proof vents and using fire-resistant building materials, can cost you substantially. Additionally, maintenance expenses to make the property fire-ready tend to be higher than the upkeep of properties in safer regions.
Con #2: More Rules and Regulations To Comply With
Local governments and authorities in bushfire-prone areas often implement stricter building codes. They also have unique regulations to enhance fire safety in these areas.
But these rules tend to restrict the design, materials, and landscaping options available to property developers. They can also limit the property’s customisation potential, which is an aspect many property buyers consider.
Con #3: Natural Risk Factors
Of course, the most significant concern when buying and investing in a property in a bushfire zone is the inherent risk of fire incidents. We know that bushfires can be unpredictable and devastating. They can cause extensive damage to properties and endanger lives.
As such, insurance costs for properties in bushfire zones tend to be higher. And there is no guarantee that home insurance coverage will be available for all types of damages caused by bushfires.
Buy The Right Property With Archistar
Doing your due diligence can help you understand the long-term implications of owning property in a bushfire-prone area. And to help you make a more informed buying decision, consider utilising Archistar.
The platform has a bushfire layer feature—a valuable tool offering insights into bushfire-prone areas. By leveraging this tool, you can get insights into properties with lower risks for bushfires. And learn how you can potentially safeguard a property that’s located in a bushfire zone.
So, try out Archistar for free today. Discover how the platform can help you make a well-informed property purchase.