Some of you may remember back in 2013, increased costs for flood insurance was big news, and threw a huge wrench into the real estate market here in Florida.
The actual start of this upheaval was in 2012, when Congress passed the Biggert-Waters Flood Insurance Reform Act, to gradually phase out subsidized flood insurance rates. The roll out of the new rates was delayed for 15 months, so 2013 was when homeowners, and recent home buyers, discovered abruptly their flood rates might skyrocket for their older homes located in flood zones. (Many older homes were not built to the current code for flood zone homes, thus lenders requires flood insurance on these homes.)
And many sellers of older homes in FEMA-mapped flood zone areas suddenly discovered that buyers were scared off by the prospect of huge flood insurance premiums.
Such an uproar ensued that in 2014 Congress passed the Homeowner Flood Insurance Affordability Act, which slowed down the process and put some safeguards into place with the intention of reducing the impact of the legislation on homeowners and the real estate market, then still struggling to recover from the Great Recession.
With the 2014 Act as a panacea, lots of folks allowed the concern about increased flood insurance rates to fade away, and today the real estate market is strong, with a shortage of homes for sale.
So, where do we stand today? The front page of today’s Tampa Bay Times featured an article about this very subject (click here to read the Time’s flood insurance article), and warns about “…the first wave of higher flood insurance premiums that is now hitting homeowners.”
John and I continue to let buyers know about the possibility of significant flood insurance increases for homes in flood zone areas. We urge our clients – past and present – to read the Time’s article as well, and stay informed on this issue that could impact many of us, either as homeowners, real estate investors, or in real estate-related professions.
As usual, please contact us at 727-286-1249 if you, or someone you know, need to buy or sell a home.Google+