Assessing the immediate and shortterm impact of f

Authors: Chris Eves Sara Wilkinson

Publish Date: 2013/11/27

Volume: 71, Issue: 3, Pages: 1519-1536

PDF Link

Abstract

The past decade has seen an increase in the number of significant natural disasters that have caused considerable loss of life as well as damage to all property markets in the affected areas In many cases these natural disasters have not only caused significant property damage but in numerous cases have resulted in the total destruction of the property in the location With these disasters attracting considerable media attention the public are more aware of where these affected property markets are as well as the overall damage to properties that have been damaged or destroyed This heightened level of awareness has to have an impact on the participants in the property market whether a developer vendor seller or investor To assess this issue a residential property market that has been affected by a significant natural disaster over the past 2 years has been analysed to determine the overall impact of the disaster on buyer renter and vendor behaviour as well as prices in these residential markets This paper is based on data from the Brisbane flood in January 2011 This natural disaster resulted in loss of life and partial and total devastation of considerable residential property sectors Data for the research have been based on the residential sales and rental listings for each week of the study period to determine the level of activity in the specific property sectors and these are also compared to the median house prices for the various suburbs for the same period based on suburbs being either flood affected or flood free As there are 48 suburbs included in the study it has been possible to group these suburbs on a socioeconomic basis to determine possible differences due to location and value Data were accessed from realestatecomau a free real estate site that provides details of current rental and sales listings on a suburb basis RP Data a commercial property sales database and the Australian Bureau of Statistics The paper found that sales listings fell immediately after the flood in the affected areas but there was no corresponding fall or increase in sales listings in the floodfree suburbs There was a significant decrease in the number of rental listings follow the flood as affected parties sought alternate accommodation The greatest fall in rental listings was in areas close to the floodaffected suburbs indicating the desire to be close to the flooded property during the repair period

Keywords: