Since Hurricane Sandy, people looking to buy a house in the Five Towns have been much more diligent in checking the updated FEMA flood maps to see if their prospective house lies in an area that is likely to flood.
In the years before Sandy, most if not all buyers didn’t pay much attention to whether a house was located in a flood zone or if that required the purchase of some form of flood insurance, unless it was one of those homes on certain streets that had a tendency to flood every time it rained.
Ironically, the streets that flooded were only avoided by a small percentage of home buyers since, aside from the slight inconvenience of not being able to leave your house while it rained, for the most part no one worried about a house flooding during a rainstorm back then.
Fast forward to Hurricane Sandy, when so many homeowners who never dreamed their homes would be susceptible to flooding got hit very badly and flood insurance suddenly became front and center. Those homeowners who had never previously considered buying flood insurance were suddenly hit with the high premiums that have taken hold as a permanent fixture for the future.
New home buyers who are looking to purchase a home must now take into consideration flood insurance as part of a mandatory expense on top of taxes and homeowner’s insurance, not to mention the mortgage, when they budget for how much house they can afford while shopping for a new home.
Unfortunately, flood insurance has become difficult to calculate since under the new formula, each house on a given block may be earmarked by FEMA differently based on criteria such as height, land elevation, basement or no basement, to name just a few categories, so that one house could be priced at a low yearly premium while the house next door might be twice or even three times higher based on the FEMA guidelines.
The best way to calculate what the flood insurance premium would be for a given address is to first ask the existing homeowner what their flood insurance premium is for that given year. Homeowners with existing flood insurance policies can transfer it to a new owner as opposed to the new owner having to buy a new flood insurance policy at a higher premium.
In some cases, the homeowner may not have a flood insurance policy since some homeowners who own their property outright may opt to not take out flood insurance since flood insurance is optional for homeowners without a mortgage.
Mortgage lenders, on the other hand, do a flood search based on the FEMA flood map, and if they determine that a home is within the flood map even to the slightest degree, flood insurance is a mandatory item necessary for issuing a mortgage. The prospective home buyer should contact his insurance company, give them the address of the house under consideration, and have the insurance company advise them as to what flood zone determination that address falls under and the amount based on present rates that a flood insurance premium would cost if they decided to purchase that particular property.
For those of you who would like to research more about flood insurance and the guidelines and different zoning determinations used by FEMA, I recommend you go online to the FEMA website and look through the extensive consumer information available. I advise you to go to FEMA.gov/flood-maps.
Wishing everyone an easy fast and brighter new year with our hostages free and soldiers back home with their families. n
Anessa Cohen lives in Cedarhurst and is a Licensed Real Estate Broker (Anessa V Cohen Realty) with over 20 years of experience offering residential, commercial and management real estate services. You are invited to visit her website at WWW.AVCREALTY.COM. She can be reached at 516-569-5007 or Readers are encouraged to send any questions or comments by email to anessa@avcealty.com.
