'We're going to sell': flood study fears force family to pack up and move

Deb Beesley's parents' house on a hill in Elermore Vale has never flooded.

Despite going 32 years without incident, Ms Beesley now feels forced to sell her inheritance because of "grave fears" for what City of Newcastle's draft Hexham and Woodberry Catchments Flood Study will do to land values and insurance premiums.

Her parents, who have since died, bought the house new. Ms Beesley's brother now calls the Andretta Avenue property home.

"It's just mind-boggling," Ms Beesley said. "You're just in disbelief, extreme anger, we're going to sell it."

The property is part of a 12-house strata. As a result, everyone in the scheme will have to fork out for insurance, and Ms Beesley said a number of residents were on age pensions.

"This is going to kill them," Ms Beesley said.

"It's just tragic, it's absolutely horrible. I have grave fears for this, I really, really do."

City of Newcastle, in partnership with Maitland City Council and Cessnock City Council, has engaged a specialist consultant to develop a flood study for the Hexham and Woodberry Swamp catchments.

The draft flood study focuses on flash flooding, including rare and extreme events for the local creeks and drainage channels that flow to the Hexham and Woodberry swamps. It proposes to reclassify 1903 homes as flood-affected based on a probable maximum flood (PMF) index.

Suburbs in Newcastle within the study area include Wallsend, Jesmond, Shortland, Elermore Vale, Rankin Park, Maryland, Beresfield, Fletcher, Minmi and part of Black Hill.

If adopted, the classification would have a significant impact on land values and insurance premiums. Affected property owners were advised of the proposal on October 6.

"As your property is classified as flood affected, flood related development controls may apply to future development on your property. Being classified as flood affected does not prevent a property from being developed or mean that the same controls apply to every property," the letter said.

In a statement to the Herald, a City of Newcastle spokesperson said the state government required that all local councils manage the risk of flooding within their local government area.

"To manage flood risk, the development and adoption of flood studies is required through the NSW Government's Flood Risk Management Manual 2023 as part of the NSW Government's Flood Risk Management framework," the spokesperson said.

"City of Newcastle understands insurance costs are an important concern for property owners, particularly with ongoing cost-of-living pressures. Flood studies are not prepared for the explicit purpose of insurance and individual insurers use data from a variety of sources to determine flood risk and insurance premiums.

"Different companies will assess the risk in different ways and councils do not control what flood data insurers choose to use or how they use it. We encourage residents to obtain quotes from a variety of insurers to find the most competitive price for their insurance."

Newcastle licensed conveyancer Leah Stevens said buying property in a flood-prone suburb could become increasingly expensive and risky, even if the home itself was affordable.

Ms Stevens broadly supports the council updating its flood study, but she believes buyers and existing residents need to understand the financial implications of living in areas at risk of flooding.

Usually, buyers would organise home insurance towards the end of buying a home.

With costs rising, she is advising clients to get quotes before exchanging contracts.

"I always warn clients when they're buying in flood-prone or bushfire-prone areas to get home insurance quotes before they proceed with an exchange of contracts," Ms Stevens said.

"A couple of clients received quotes to include flood coverage, one was $11,000 a year and another was $14,000 a year. So we've certainly seen some high insurance costs coming in."

Ms Stevens said one couple, who were looking at a property on flood-prone land in Maitland, were quoted $20,000 a year to include flood coverage.

"It's quite scary, from what I understand, Allianz, one of the big insurers for new clients, they will not let people opt out of flood cover," Ms Stevens said.

She warned changes to the council's understanding of flood-prone land could have implications for people wanting to build.

Properties identified as being in flood-prone areas could face extra requirements or restrictions when it came to construction, Ms Stevens said.

"If you were building, you'd want to be aware that there could be some changes afoot in the areas that you're buying and building in," she said.

One of her long-term concerns is that climate change and more frequent flooding could eventually lead some insurers to stop offering cover in some locations altogether.

"That's another problem, when governments need to step in and do property buybacks, and these could be people that have lived in certain areas for a long, long time as well," Ms Stevens said.

"It could be a bit of a rude shock for some, but we have to be aware, and people have to take notice."

Heidi Clark lives in Rosedale Crescent, Rankin Park, and said there had been no history of flooding on her property in the 27 years she had lived there.

"I was extremely concerned and frustrated. For my property the study fails to distinguish between a small, potentially inundated portion of land and the actual flood risk to the property's dwelling, structures and usable areas," Ms Clark said.

"In my case, the land which is unused and inaccessible is being treated in a way that classifies my entire property as at risk."

Ms Clark said residents should not have to suffer financial penalties because of a flood classification that "does not accurately represent the actual risk" to homes and usable land.

"This is not simply information on a map," she said.

"It can have serious financial consequences, including increased insurance premiums, reduced property values and difficulties selling or refinancing a home.

"Residents are the ones who will bear those consequences, not council. We are asking for common sense, accuracy and accountability."

A spokesperson for City of Newcastle said the draft flood study focused on flash flooding, including rare and extreme events for the local creeks and drainage channels that flow to the Hexham and Woodberry swamps.

"It has been developed using best practice modelling techniques and climate science to understand current and future flood behaviour," they said.

"This will help us understand and manage risks to property and life, and inform land-use planning, emergency planning and disaster recovery, community flood awareness, flood mitigation works, and property modification projects."

The public exhibition period is open until December 18. City of Newcastle has appointments for people to directly ask questions regarding their property.

"People can register their interest for an online or in-person one-on-one appointment which will be offered at a variety of times including opportunities within business hours, after 5pm and on a Saturday," a City of Newcastle spokesperson said.