Meanwhile, in western Sydney, properties in the neighboring suburbs of Pitt Town and McGraths Hill, located within the low-lying Hawkesbury catchment, have seen their value decrease by $363,500. This represents an 8.7% reduction compared to homes not facing flood risks.

However, McKenzie said the problem “compounds inequality”.

Former prime minister Scott Morrison inspects a flood-damaged property in Sydney’s McGraths Hill in 2022, where property values have since dropped by nearly 9 per cent. Source: AAP / Dean Lewins

“In some of these regions where we’ve identified the flood risk being really high, they’ve been inundated multiple times within a five-year period,” she said.

“People can become trapped,” she said.

Richer areas not immune

A damaged Putt Putt golf course at Mermaid Beach following ex-Tropical Cyclone Alfred in early 2025. Source: AAP / Dave Hunt

However, the report did find the drop in value was smaller in some of the more prestigious areas. Noosaville and Noosa Heads were two places where coastal vistas and an enviable beach lifestyle outweighed the risk of flooding.

“No matter what demographic the property is in, if your home is flood-affected, it has increased less than others.”

Who should pay the penalty?

“The government will need to buy back houses because it won’t be feasible to live in those locations anymore. Those costs should be absorbed by the whole community because people didn’t know that that was going to be the risk that they were exposed to.”