Featured News 2015 What Floods Have to Do With the Real Estate Market

What Floods Have to Do With the Real Estate Market

Whenever there are devastating floods that damage people's homes, realtors get calls from flood-affected homeowners who are shell-shocked. When homes that are on the market get flooded, it can cause real estate deals to fall through.

Clients who are in the middle of real estate transactions wonder if they should fix up their homes and move back in, sell them as is, tear them down and build new ones, or move to another home.

When there's major flooding, this concern is especially great for homeowners who have lived in the same home for years, if not decades and can't afford to buy a house in their own neighborhoods because real estate prices have skyrocketed, sometimes by hundreds of thousands of dollars.

How does property value change after a flood?

It's more or less of a case-by-case bases. Realtors don't have a crystal ball. According to the Federal Emergency Management Agency (FEMA), over 20,000 communities in the U.S. are in major flood zones.

While FEMA says that first-row, beach-front properties and properties near water are at the greatest risk, a flood can happen in virtually any neighborhood.

Floods leave a trail of problems for builders from everything involving labor to construction materials. Bad weather in general, has a tendency to hamper the home construction industry, and it can exacerbate a region's housing shortage problem.

If you're buying or selling a house, a flood makes things more complicated. For example, most lenders these days are requiring an additional inspection for homes in areas that have been affected by floods to ensure there is no flood damage.

If you're concerned about flood damage affecting your real estate transaction, use our directory to find a real estate attorney who can ensure that your best interests are fully protected.

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