For various reasons, more Australians are warming up to the idea of buying properties in areas that experience floods. Discover if it’s really a risk that’s worth taking.

Floods are a costly, recurring issue in Australia. The economic toll of floods is substantial, with annual damages reaching billions of dollars.

In fact, the flooding that the country experienced during the summer of 2010-2011 reportedly cost the Australian economy $30 billion dollars.

As such, knowing the implications of owning property in high flood-risk areas is crucial. This now begs the question:

How do we determine which areas have a high flood risk?

In simplest terms, high flood risk zones are areas prone to flooding during heavy rainfall or when nearby rivers overflow. These zones are classified based on historical data and future likelihood of floods. 

Floodwaters can damage buildings, reducing property values and leading to expensive repairs. In turn, home insurance premiums can be higher, and finding coverage may be challenging. 

To be clear, no property is perfect; properties in flood zones may even provide hidden opportunities. But careful consideration of all factors, particularly weighing pros and cons, is vital for making a decision.

The Pros And Cons Of Buying A High Flood Risk Property

Purchasing a property in a high flood risk area demands careful consideration, as it comes with both advantages and challenges. 


Pro #1. Lower Purchase Price

Properties located in high flood risk areas are often more affordable than those in safer zones. The perceived risk of flooding can deter some buyers. At the same time, it creates opportunities for those on a tight budget to enter the property market at a lower cost.

Pro #2. Investment Potential as Flood Measures Improve Overtime

Over time, flood-prone areas may witness improvements in flood control infrastructure and mitigation measures. As governments and communities adapt to the threat of floods, property values in these regions can appreciate and offer profitable investment opportunities.

Pro #3. Viable Renting Option for Low-Cost Tenants

Properties on flood risk zones have lower purchase prices. As such, they can be attractive to tenants looking for affordable housing options. 

Property investors can then target a niche market: tenants who do not have the financial capacity to rent or own properties in flood-safe but more expensive locations.

Pro #4. Lower Competition in the Market

The perceived risk of flooding in high flood risk areas can lead to lower competition amongst buyers. With this reduced competition, potential buyers may have a stronger negotiation power. 

And they also gain an opportunity to secure the property at a more favourable price.

Pro #5. Potential for Government Assistance

Some governments offer assistance programs, grants, or subsidies for owners of properties in flood-prone areas to implement flood mitigation measures. Taking advantage of such programs can help them reduce the risk and potential damage from flooding.


Con #1. More Expensive Home Insurance

One of the significant drawbacks of buying a property in a high flood risk area is the cost of home insurance. Insurers often charge higher premiums to cover the increased risk of flood-related damages to properties. 

This additional expense can significantly impact the overall cost of property ownership.

Con #2. More Rules and Regulations to Comply

Flood-prone areas are subject to specific rules and regulations set by the local government. This is to ensure the safety and protection of residents. Building codes may require things like the use of flood-resistant construction materials and elevated foundations. 

Compliance with these regulations can add complexities and costs to the development of a property and its maintenance.

Con #3. Potential Damage and Repair Costs

Living in a high flood risk area exposes the property to the constant threat of flooding. 

As mentioned, floodwaters can cause extensive damage to buildings. This often necessitates costly repairs and renovations. Additionally, the recurring risk of flood-related damages can negatively affect the value of your property.

Con #4. Disruption to Daily Life

Flood events can disrupt the daily lives of residents. For instance, it can cause temporary displacement, damage to their personal belongings, and even physical injuries. 

The stress and uncertainty associated with potential flooding is also worth noting. 

Living in an area with a constant flood risk can cause homeowners to be in a state of emotional stress and anxiety for longer periods. This lack of stability and peace of mind in their living situation can be detrimental to their mental health.

Con #5. Limited Resale Demand

Owners of properties in high flood risk areas might face challenges when it comes to resale demand. 

The reality is that many potential buyers are still hesitant to invest in such properties. This then reduces the pool of potential buyers for a property. Not to mention it potentially leads to longer selling times.

Make The Right Choice With Archistar

Making the right choice when it comes to buying property in a high flood risk area requires a careful evaluation of the pros and cons. However, it can be difficult and time-consuming to check flood zones… on top of everything you’ve got to do during your research. 


The good news is Archistar is here to help you assess the feasibility of any property development project. 

With its flood layer feature, you can gain valuable insights into the flood risks of a particular area. Use this feature with other layers and filters to make a comprehensive assessment of a property’s potential. 

Try out Archistar for free today and see how it can help you buy the right property.