Important takeouts:
Buying a home in a flood zone involves financial and safety risks, including high insurance costs, property damage and potential resale challenges. Flood insurance is essential and often necessary if your home is in a high-risk area. It has advantages such as lower purchase prices and waterfront locations, but it requires careful measurement of the risk. Make your research early. Check the flood map, check the property’s flood history, and ask the correct questions before making your offer.
Buying a home in a flood area can be a serious risk. There are many weighting factors, from higher insurance costs to potential damage and resale challenges. However, if the lake dream house happens to be in a flood zone, it does not have to be a trade breaker.
This Redfin article explains what a flood zone is, the pros and cons of buying one, and what to consider before making an offer. Whether you buy a home, rent a home or live in an apartment, understanding how flood zones affect your property can help you make smarter and safer choices.
What is a flood zone?
Flood zones are geographical areas identified by the Federal Emergency Management Agency (FEMA) and are at certain levels of risk of flooding. FEMA flood zones range from high to low risk. They are assigned based on factors such as weather patterns, elevation, and historical flood data.
Special Flood Hazard Areas (SFHAs) are the highest risk zone, with the possibility of flooding of over 1% per year. 1% may not seem to be a high percentage, but this will be one in four of the floods over the course of a 30-year mortgage.
How can I check if my home is in a flood zone?
The easiest way to find out if you are buying a home in a flood zone is to check the address of FEMA’s Flood Map Service Center. Flood zone details may also be displayed in seller disclosures, but this is not a requirement for all states.
It is important to do your own due diligence to understand your risks. Even homes outside the SFHA could still be at risk of flooding. See multiple sources, including county records, elevation maps, and home claim history for the most accurate photos and updated flood information.
Pro Tip: When looking at Redfin’s real estate listings, you can see the details of the facility, including climate risks, flood zones and more.
Start your research early in the home buying process to ensure that you start searching in areas that match your comfort level with risk.
>>Read more: Is my house in a flood zone?
6 Risks to Consider When Buying a Home in a Flood Area
The risk of buying a home in a flood area should not be considered lightly. Before proceeding, be sure to carefully review some of the best risks listed below.
Expensive Flood Insurance: Depending on the level of risk, flood insurance can be very expensive. There are particularly trends in coastal states, lower elevation housing and hurricanes. This will lead you to the affordable calculations for your home. Different types of flooding: River swells and hurricanes are very different events, but both can inundate your home and cause serious damage. Knowing what to expect will help you prepare your home and yourself for a major event. Massive Damage: Even an inch of water can cost thousands of dollars to repair. Floors, drywall and electrical systems may all need to be replaced in the event of a flood. Not to mention furniture and personal items. Difficult to resell: Flood risk can reduce the value of your home due to associated risks and insurance costs, and purchasing in a flood zone may be an investment that is difficult to sell later. Evacuation and Safety Concerns: If you live in a flood-prone area, it is essential to have an emergency plan, as serious flooding can force you to evacuate. Emotional distress: There is additional risk, which creates additional stress. Floods can be a blow to your mental health, including stress, anxiety, and emotional strain, especially when experiencing significant losses.
>>Read more: What to do after a flood: 10 important steps for homeowners
Are there any benefits to buying a house in a flood zone?
Despite the risks, there are good reasons to buy a home in a flood zone.
Reduced Purchase Price: This is considered a risk of resale, but you can take advantage of the lower price as a buyer. Otherwise, you may be able to afford a home in an off-budget flood area. Declining competition: There may be fewer buyers interested in flooded homes, so there are not much to worry about bidding. Waterfront Properties: Those who dream of a sunny beachfront facility or enjoy morning coffee while enjoying a lake view will be willing to embrace potential flood risks and invest in insurance costs.
Can I still get a mortgage in a flooded house?
Yes, getting a mortgage in a flooded home is very similar to getting a mortgage elsewhere. However, if your home is in SFHA, the lender may need to purchase flood insurance before approving the loan.
Some government loans also have specific requirements for high-risk properties. Check these carefully before starting your home search.
Do I need flood insurance?
If you are buying a home in a flood area, you will definitely need flood insurance. Traditional homeowner insurance doesn’t cover floods even if the lender doesn’t need it. To get a quote, you’d like to check with your provider for other options, like the National Flood Insurance Program (NFIP), or look into other options. Knowing whether to pay monthly insurance before making an offer can help you budget for your mortgage expenses.
>>Read more: What does flood insurance cover?
Important questions to ask before purchasing
There may be answers from seller disclosures or real estate agents, but ask and answer some of these important questions to prepare yourself for buying a home in a flood zone.
What are the classifications of flood zones in this area? Have you ever had a lot of real estate in the past? What is the history of the property claim? How often does a property get flooded? What is the estimated cost of flood insurance in this area? What did the community or government do to protect the area and alleviate flooding? What has been done to the property to alleviate the floods?
Purchases in flood zones are a personal decision
When considering whether to buy a house in a flood zone, no one has the answer. Risk, cost and stress are real, but it doesn’t necessarily mean breaking the contract. With proper precautions, flood protection, and often low prices, it could still be the right move. Ultimately, your decision will depend on what is best for you.
FAQs about buying a house in a flood zone
Should I buy a house in a flood zone?
Whether or not you should buy a home in a flood zone is a personal decision as to whether the risk outweighs your profits. It is essential to carefully review the classification of zones and understand the precautions you need or already in place. And if the additional cost of flood insurance pushes you outside your ideal budget, it may be time to move on.
Can I change the flood zone?
Yes, you can change the flood zone. FEMA regularly reviews flood maps and data, and climate change has required more changes over the years. Just because your home is not currently in a high-risk area doesn’t mean it won’t change. You can also request a change of flood zone if you believe your home is being accidentally zoned with SFHA.
Does homeowner insurance cover floods?
No, standard home insurance does not cover any kind of flooding. Flood insurance requires a different insurance policy. Find out if your area can be covered by federally funded NFIP. Private insurance companies also offer coverage options.
How do I know if my house has been flooded previously?
Not all states require that seller disclosures include flooding, so it’s important to do some of your own research. Search local government records or past insurance claims, check for signs of flooding, talk to neighbors, and get a personal perspective on flood risk in your neighborhood.
How can I protect my home from flooding?
Flood insurance is the best way to guarantee your home in the event of a flood, and your wallet is protected. To learn more ways to protect your home from floods, preventing or minimizing damage can save stress and also reduce costs in the long run.
