Buying A Flooded House !!TOP!!
Millman analyzed all the homes sold in North Carolina, New Jersey, and New York in 2021 and found that 6.6 percent of them, 28,826 homes, had been previously flooded. Millman used Federal Emergency Management Agency data and independent flood risk models to determine past and future flooding for these properties. The report found that, if the climate were to stay exactly the same as it is today, the average individual homeowner of a previously flooded home would expect to pay roughly $18,000 in flood-related damages over the course of a 15-year mortgage in North Carolina, $25,000 in New Jersey, and $47,000 in New York.
buying a flooded house
In North Carolina and many other states, sellers don't have to tell home buyers if a house has ever been damaged by flooding. A new study says that lack of disclosure can mean unexpected and costly future damages.
He said the risk is heightened in today's real estate market where there's pressure to close deals quickly, sometimes without inspections. And while an inspection might spot water damage, it won't tell you if a house is likely to flood again.
And then there's climate change, which is expected to increase future flood damage through rising seas and more intense storms. The report considers three scenarios, including one where we fail to reduce greenhouse gas emissions fast enough.
With the recent floods in Houston, there have been floods in areas that have not been flooded before. I recently came across a house on a golf course in a desirable neighborhood. However, the homes (about 125) all took in water with this last flood. This particular house had a pending sale on it for 225K the day before the floods and of course the buyers backed out. The house had about a foot of water (just below the outlets) and the owners took the appropriate measures to have the house dried out and mold remediation done. This was a 500 hundred year flood are, but the owner did mention that the house received about and inch of water about 10 years ago as well.
In 2017, Hurricane Harvey shocked a lot of Houston residents by flooding 96,000 homes, including a gracious plenty that they had thought were safe. Turns out a lot of them had been flooded before, but nobody had told the buyers. (Sound familiar?)
Since 1999, Storm Water Services has purchased over 400 flood-prone houses, apartment buildings and businesses that were in floodplains throughout Charlotte-Mecklenburg. Over 700 families and businesses have moved to less vulnerable locations outside of local floodplains. 185 acres of public open space has been "undeveloped" to allow the floodplain to function during heavy rain and provide a long term community asset. Storm Water Services also estimates these buyouts have avoided $25 million in losses and will ultimately avoid over $300 million in future losses.
During Hurricane Harvey, many homeowners who flooded didn't realize they were at risk, but that could be changing. Starting on September 1, prospective buyers will receive additional details about a property's flood risk when a new state law goes into effect, requiring more information on the updated seller's disclosure form.
Sellers already had to disclose if a home is located in the 100-year floodplain, or if it previously flooded. Now, to comply with SB 339, authored by State Sen. Joan Huffman, R-Houston, they'll also have to disclose if it's wholly or partially in the 500-year floodplain, a reservoir or a flood pool.
"Greater intensity and higher amounts of precipitation are causing flooding for houses that didn't even flood during Harvey," Baldwin said. "And that will continue to be the fact from this point forward."
There are other new details to disclose now, too, beyond whether or not a property flooded. What if the house didn't flood, but the garage did? Or maybe just the yard? Baldwin said buyers will have that information now as well.
"If you got a foot of water on the property but it didn't get into the house, now we're having to disclose more than ever," he said. "Wouldn't you want to know if the water got four inches from your door?"
The first thing Larry McCanney fell in love with was the tree in the front yard. It cast shade on the porch of a house that, if he were honest, needed some work. But McCanney is handy, the price was right and the location was perfect, just a couple of miles from his childhood home in Burlington, N.J.
"We just kind of wanted to get our family started, and it was affordable for us," McCanney says. "I'm still paying college loans off 11 years later, [and] we wanted to ensure that we were purchasing a place that, should I lose my job or if [my wife] lost her job, we wouldn't be out of a house in two months' time."
The homes that the Department of Housing and Urban Development (HUD) sells are foreclosures. The previous owner was unable to pay their federally insured mortgage, and the house was seized by a bank and turned over to HUD. Only a small percentage of foreclosed homes in the United States end up being sold by HUD, but the numbers add up. Between 2017 and 2020, HUD sold nearly 100,000 homes around the country.
Like McCanney, many buyers are first-time homeowners excited to find a house they can afford. There is a nationwide shortage of affordable homes, especially for low-income families. Providing safe, affordable housing is HUD's mission.
But an NPR investigation finds that the homes HUD sells are disproportionately located in flood-prone places, compared with Zillow records of all homes sold in the United States. The agency does not fully disclose the potential costs and dangers of living in harm's way, and some of these transactions have happened as local governments are buying out properties in the same areas to mitigate flood risk.
Interviews with people who bought homes from HUD in multiple states make it clear that many buyers don't learn that their houses are in an official flood zone until after they've made an offer or paid a nonrefundable deposit. And even if a house doesn't flood immediately, the cost of managing flood risk can be significant.
There is no federal regulation requiring HUD to disclose flood risk to potential buyers. Most buyers find out their new house is prone to flooding when they are notified that they must purchase flood insurance, which happens so late in the homebuying process that it is often too late for families to back out of the purchase.
That's what happened to McCanney. "That's the one disappointment in this area. We're in a flood zone, so we have to pay pretty expensive flood insurance," he says. "I didn't really take that into account when we first bought it." This summer, a rainstorm flooded the park across the street and sent a foot of water into McCanney's basement after his sump pump broke. McCanney says they're eventually hoping to move to a house that's not in a flood zone.
"This is an incredible insight," says Laurie Schoeman, the resilience director for the national housing nonprofit Enterprise Community Partners, which manages affordable housing around the country. "It only bolsters the reality that a lot of homes that have provided shelter to low-income households are in areas of greater risk. These homes are in really vulnerable areas, and it puts households at risk."
"We need to let people know 'Your dream house is wonderful, and here are the steps you're going to need to take to protect it from flooding, because you're in a flood zone,'" says Schoeman. "That's the conversation we need to have. Not, 'Here's your house!' And then you find out later after the first flood, 'Oh boy, I'm in a really bad situation.'"
Long-term costs of flood damage can do tremendous harm to families, especially those who put their life savings into a home and live paycheck to paycheck. Low-income households are more likely to face health problems, displacement and bankruptcy after a major flood. In the long term, flooding can wipe out a family's generational wealth by driving down home values or destroying homes altogether.
Jonathan Stewman bought his house in Denham Springs, La., in the spring of 2019. Homeownership was a lifelong dream, and he was excited to move in with his wife and two toddlers. They painted the porch and put in some new front steps. Now, they like to ride four-wheelers in the big backyard, and he's building the kids a swing set.
Stewman grew up in an apartment in nearby Baton Rouge and always dreamed of having his own place, a family and a yard for the kids. "I never knew what it was like to stay in a house. So when I moved here, it felt like home immediately," Stewman says.
Stewman purchased his home just three years after a massive, climate-driven rainstorm dumped more than 20 inches of rain over the area in less than 24 hours. Stewman and his wife were told by their real estate agent that their house took in about 2 feet of water that day. But the benefits of the house seemed to outweigh the risks. "I got a good deal on it," he says.
For example, after a 2016 storm flooded over 50,000 homes in and around Baton Rouge, the state offered buyouts. FEMA sent more than a thousand letters to residents, telling them that they needed to elevate their homes or move. The areas targeted for buyouts included the town where Stewman lives. NPR's investigation found that HUD sold at least 19 homes in that town between 2017 and 2020.
Akouete Yemey purchased his house in Roanoke, Va., from HUD. The house is located in the highest-risk flood zone. Yemey says buying directly from the government initially made him trust that the house was safe. He is considering a government buyout so his family can move to higher ground. Ryan Kellman/NPR hide caption
In Florida, federal data obtained by NPR and member station WLRN show that four homes sold by HUD in Miami-Dade County are listed as "severe repetitive loss properties" by FEMA. Such properties have been flooded and rebuilt multiple times, at taxpayer expense. All together, the properties incurred nearly $500,000 in flood insurance payouts between 1999 and 2015. 041b061a72