Rising seas could cost Australia $855 billion as 267,000 properties face flooding
Australia faces an $855 billion economic hit from rising seas and storm surges this century, with more than 267,000 coastal properties and two million hectares of land projected to be damaged by flooding by 2100.
Under a higher-emissions scenario, the picture becomes considerably worse. The number of affected properties rises to almost 720,000, while the estimated economic damage reaches $1.9 trillion.
The figures come from the first national-scale assessment of the economic impact of sea-level rise and storm surge across Australia, published this week in the peer-reviewed journal Scientific Reports. Researchers from the University of Melbourne and Australian National University assessed 1,156 coastal sub-regions across six states and the Northern Territory.
The more conservative scenario calculates $855.1 billion in present-value losses by 2100, comprising $274.3 billion in property damage and $580.7 billion in damage associated with land use. The researchers warn even those numbers may understate the eventual cost because the modelling excludes some environmental assets, cultural heritage and infrastructure.
The Climate Council, which has released the findings in its new Rising Seas, Rising Bills report, says Queensland has the largest number of properties exposed, at 93,157, followed by New South Wales with 71,210 and Western Australia with 51,366.
Western Australia faces the biggest overall financial loss at $230.5 billion, driven heavily by damage to land, including agricultural areas. Queensland follows at $214.5 billion, Victoria at $167 billion and New South Wales at $150.7 billion. South Australia faces losses of $49.2 billion, the Northern Territory $35.2 billion and Tasmania $7.9 billion.
The Gold Coast emerges as the most exposed major urban area in the country. About 32,490 properties are projected to be affected, with economic losses estimated at $84.4 billion. Areas identified include parts of Paradise Point, Runaway Bay, Biggera Waters, Mermaid Beach and Palm Beach.
In NSW, the greatest financial impact is projected across northern parts of the state, including Ballina, Byron Bay, Brunswick Heads, Kingscliff and Tweed Heads. Greater Sydney is projected to have 17,631 properties affected and suffer about $20 billion in economic losses, with exposed areas including Botany, Mascot, Brighton-le-Sands, Kyeemagh, Sans Souci and parts surrounding Sydney Airport.
Melbourne also faces substantial exposure. Low-lying areas around Port Phillip Bay and the Yarra River feature prominently in the modelling, including Docklands, Southbank, Carrum and Patterson Lakes. Geelong and communities around the Bellarine Peninsula are also identified among Victoria’s more vulnerable areas.
The cost goes beyond flooded houses
The economic threat is not confined to waterfront property.
More than 619,000 hectares of Australian farming land are projected to be damaged under the study’s conservative scenario, raising longer-term concerns for agricultural production as saltwater inundation and coastal flooding affect productive land.
The researchers estimate the recurring economic damage could reduce Australian GDP by an average of between 1.05 and 1.39 per cent under the more conservative scenario. Under the higher-emissions pathway, the estimated drag rises to between 2.26 and 3 per cent.
Professor Tom Kompas, one of the study’s authors, said the projections sit at the lower end of what could eventuate.
“I personally think we are in real trouble, we need to do something now to start reducing global temperatures,” he said.
Sea levels have already risen by more than 22 centimetres globally since 1900, while a further rise of about 14 centimetres around Australia is considered effectively locked in by 2050. As the baseline sea level rises, storm surges and high tides begin from a higher starting point, increasing the frequency with which coastal infrastructure and communities are inundated.
The Climate Council says every additional 10 centimetres of sea-level rise could triple the frequency of coastal flooding events historically described as occurring once in 100 years. In Sydney, minor coastal flooding that currently occurs for a little over a week each year could occur daily by the end of the century under a high-emissions scenario.
Australia’s own National Climate Risk Assessment reached a similarly stark conclusion last year. The federal assessment found sea-level rise could place an additional 1.5 million people in high-risk coastal areas by 2050 and classified the risk to coastal communities as increasing from moderate today to high by 2050 and severe by 2090.
The insurance question
For homeowners, there is another financial problem. Standard home insurance generally does not cover damage classified as an “action of the sea”, such as coastal erosion, tidal inundation and some forms of coastal flooding.
The Insurance Council of Australia has previously estimated governments will need to invest at least $30 billion over 50 years in large-scale coastal protection and adaptation projects. It has also warned that protection will not be economically or physically viable everywhere, leaving some communities facing difficult decisions about retreat from highly exposed areas.
Kompas warned that insurance costs were likely to climb as risk becomes clearer.
“Home insurance costs will increase significantly,” he said, adding that insurers were already reassessing premiums using increasingly detailed flood mapping.
Australia released its first National Adaptation Plan in 2025, setting out how governments, businesses and communities should prepare for physical climate risks. Among its findings is that some highly exposed coastal communities may ultimately require relocation.
For Australia, where cities, housing, infrastructure and some of its most valuable agricultural land are concentrated near the coast, the new research places an economic figure on a risk that has until now often been discussed in physical terms.
At $855.1 billion, that figure is already formidable. At $1.9 trillion under the study’s higher-emissions scenario, rising seas become not simply a coastal problem but one of the largest long-term economic risks facing the country.
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