Extreme flood predictions are having a growing impact on real estate demand in the UK, with prospective homeowners and investors increasingly avoiding flood-prone areas, according to new research published in Risk Analysis.
The study, conducted by the University of Portsmouth in collaboration with the University of Oxford and Coventry University, found that flood risk perceptions are now a primary factor influencing property values, particularly in coastal locations such as Chichester and Portsmouth. Researchers warn that this trend could have long-term economic consequences for homeowners, investors, and the wider economy, making flood risk management a national and global priority.
Flooding is becoming more frequent and severe, with the UK already experiencing annual damages exceeding £120m to business premises alone due to coastal flooding. The study highlights a shift in consumer behaviour, with buyers prioritising safer locations even when those areas are less desirable in terms of aesthetics or amenities.
Dr Scott Mahadeo, senior lecturer at the University of Portsmouth, said: “Our study shows that flood predictions, despite their uncertainties, are the primary factor influencing people’s willingness to pay for properties. When flood prediction data is available, people are more likely to shy away from properties in areas predicted to be at risk of flooding, even if the predictions themselves are uncertain or conflicting.”
The research, which involved flood modelling, a survey of 731 UK residents, and geospatial analysis, found that access to multiple flood prediction sources is exacerbating concerns. Respondents were willing to pay significantly more for properties outside flood-prone areas, even when their preferred locations were in risk zones.
Dr Mahadeo added: “There is a lack of consideration for flood model uncertainty in real estate decision-making. People are making decisions based on extreme flood predictions, and they’re not factoring in the potential errors or variability in the data. This suggests that we need to focus more on effectively communicating the uncertainties in flood predictions to the public to avoid unintended economic consequences.”
The study calls for improved communication of flood risk and its uncertainties, warning that as climate change accelerates, flooding frequency and intensity will increase. Researchers argue that clearer messaging is needed to prevent undue property devaluation and ensure buyers make informed decisions based on realistic risk assessments rather than worst-case scenarios.
