Australia faces $850 billion sea level rise damage bill, first nationwide assessment finds

The study, published by researchers including Professor Tom Kompas of the University of Melbourne, breaks down the projected costs into $274 billion in property losses and $580 billion in land-use damage. Kompas described the findings as “alarming”, noting that continued fossil fuel emissions would drive higher sea levels, stronger tides and more frequent storm surges.

Queensland is identified as the state with the most properties at risk — 93,000 — carrying a damage bill of $214 billion. Within Queensland, the Gold Coast is Australia’s most exposed urban area, with projected economic losses of $84.4 billion. Western Australia faces the largest total losses of any state, while in New South Wales, communities in the state’s north and Central Coast are expected to experience higher property losses than those in Greater Sydney.

The analysis is based on global carbon emissions peaking around 2040 and warming limited to approximately 2.7°C — in line with United Nations projections that warming will reach at least 1.8°C above pre-industrial levels and could hit 2.6°C under current policies. The researchers also modelled a scenario with warming exceeding 4°C, which would push damage costs above $1 trillion, though they considered that scenario unlikely given the global uptake of clean energy.

The authors note that all coastal states and the Northern Territory will face significant damage bills this century as melting ice and thermal expansion of warmer seawater continue to raise sea levels.

Why This Matters

The study puts a tangible dollar figure on climate risk for coastal homeowners and local governments, potentially influencing property values, insurance premiums and planning decisions.
With 267,000 properties at risk and damage costs concentrated in Queensland and Western Australia, state budgets and federal disaster relief arrangements face unprecedented pressure.
The findings arrive as communities already grapple with coastal erosion and flooding, raising urgent questions about who will pay for adaptation — property owners or taxpayers.

Background

Sea level rise is a well-documented consequence of climate change, driven by the melting of ice sheets and glaciers and the thermal expansion of seawater as it warms. Australia, with its densely populated coastline, is particularly vulnerable. This research represents the first nationwide economic assessment of sea level rise impacts, moving beyond physical risk projections to quantify actual dollar losses. Professor Tom Kompas, a co-author, is an environmental economist at the University of Melbourne.

Key Perspectives

Property owners: Face potentially catastrophic losses, with the prospect of stranded assets and sharply higher insurance costs as risk is repriced. Governments: Must decide whether to invest in coastal defences, retreat from vulnerable areas, or absorb the costs of future disaster relief — a choice that carries huge fiscal implications. Researchers: Argue the economic toll will escalate unless global emissions are cut rapidly, and urge policymakers to use these projections to guide long-term planning and investment.

What to Watch

Government responses: Will federal and state budgets allocate significant funds for coastal adaptation, or shift the burden to local councils and homeowners?
Insurance market: Expect rising premiums and potential withdrawal of coverage from high-risk coastal postcodes.
Property market signals: How quickly values adjust in at-risk areas such as the Gold Coast, where projected losses exceed $84 billion.

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