What to consider when buying in a coastal area

Climate change risk management and futureproofing will be key to coastal property investment moving forward. Photo/File.

The knock-on effects of climate change and sea-level rise predictions are yet to have any real impact on the Far North housing market, says Harcourts Bay of Islands managing director Tom Rutherford.

The real estate agency owner said while the topic was now talked about more frequently, most people realised climate change was just part of their new reality.

He said from an industry perspective, huge change across a variety of sectors, including climate change, had meant agencies were having to adapt, evolve and constantly review all aspects of their business.

"We are in the Far North and many have the dream of owning a beachfront property," Rutherford said.

"I personally feel any reduction in the enquiry into beachfront properties has been mainly driven by the very limited amount of (often multi-million dollar) properties that come on the market and when they do, they are out of many people's budget.

"My advice (regarding coastal properties) is to do your research. More houses and properties inland get impacted by flooding, so don't let the threat or reality of coastal flooding put you off."

Kerikeri's John Papesch is a senior civil engineer and director of Haigh Workman Ltd.

He said as a local engineer it was his role to interpret the latest science and to help his clients understand what that meant for them.

According to Papesch, the language of risk around climate change was hugely important, yet was not something he believed was done well in New Zealand.

Senior civil engineer and director of Haigh Workman Ltd, Kerikeri's John Papesch.

"In Christchurch, before the September 2010 and February 2011 sequences (earthquakes), multiple properties had liquefaction risk identified on their Land Information Memorandum (LIM) report, yet people purchased properties and built houses with liquefaction as a known, possible risk," he said.

"Perhaps if a LIM report had instead stated it was possible that sand boils would develop in their back yard, the floor would be broken in half or they'd have no water and sewerage for a couple of years, the effect of liquefaction risk would have been better understood.

"My point is, if you are looking at a purchasing a property which identifies a site as susceptible to coastal erosion or coastal flooding or other natural hazards, it is important to engage with an expert to understand how this will affect you."

The impacts of climate change will also have a significant impact on insurance and risk reduction in areas of concern.

Insurance Council chief executive Tim Grafton said there was an urgent need to look at how to reduce the risk to homes in priority areas - whether it be via changes to buildings, local infrastructure or retreat.

"What we want to see is communities paying a lot more attention to likely climate impacts and acting without delay to reduce risk," Grafton said.

"We must act now to improve resilience to climate impacts of all types if insurance is to remain widely available and relatively affordable over the decades to come.

"In the absence of action to reduce the risk to property, around just 30 cm of effective sea-level rise can turn today's one in 100-year event into something to be expected annually."

Grafton said the first step was to stop making the problem worse, i.e. local government needed to stop letting development occur in high-risk areas.

When dealing with existing development, he said people should be thinking about what steps they could take to reduce risk.