The newly updated FEMA Flood Insurance Rate Maps have shaken up the real estate market here on Cape Cod. Interest in waterfront homes has been tempered, while those homes for sale just outside of the new flood zones have seen increased activity. The market is awash with anecdotes about huge insurance rate increases on specific homes, which has caused much concern.
On Tuesday some legislation was filed that would delay the implementation of Flood Insurance rate Increases by approximately 4 years. The bill has been sent to the Senate, so there’s no final word on the new situation.
Although insurance rate increases will hopefully be delayed, there is no talk of modifying FEMA’s Flood Zone Construction Requirements. If you’re considering a renovation on your waterfront home, now’s the time.
Here’s a link to the House bill that was sent to the Senate. Chances are the final bill will be very similar:
We’ve survived the Great Recession.
The market on Cape Cod and throughout the Northeast is coming back.
Desirable shore front areas have benefitted from strong demand, even multiple Offers on homes for sale. What does the market look like going forward? How are banks viewing this market? Can we expect lending to loosen up a little? And what about the outlook for retirees and second home buyers?
Here is some great insight from two bankers and a regional real estate company. It’s a quick read with some very good information:
Cape Cod 2013 Housing Market Discussion
Cape Cod 2013 Housing Market Discussion
Although the new FEMA Flood Insurance Rate Maps have significantly impacted thousands of properties on Cape Cod, the appeals haven’t been strong. Here’s a good report from the Cape Cod Times on the situation:
Cape Cod Times article: "FEMA map appeals trickle in"
Cape Cod flood map appeals trickle in
By CHRISTINE LEGERE
October 24, 2013
CHATHAM — Despite the flap over the recently released federal flood insurance risk maps, Chatham was the only Barnstable County town to file an official appeal of map designations by the Oct. 17 deadline.
Several individual property owners appealed, and their methods varied from simple emails to multipage filings with accompanying engineering.
Most may not meet the Federal Emergency Management Agency's requirements.
The purpose of the FEMA-produced flood maps, expected to become effective in June, is to more accurately reflect an area's risk of flooding during a major storm.
The new maps put more properties into flood-risk zones in many communities. In Dennis, for example, 4,000 new properties were added to risk areas.
Those designations, coupled with dramatic premium increases for flood insurance contained in the Biggert-Waters Flood Insurance Reform Act of 2012, could cost property owners plenty.
Chatham Selectman Sean Summers said concern for the town's residents prompted his board to appeal on their behalf.
"There are people who could lose their homes," Summers said.
FEMA required towns and property owners to submit technical data with their appeals sufficient to refute federal findings.
Over the bridge, Marshfield, Duxbury and Scituate hired consultants to counter federal data on base flood elevation, which is the elevation surface water can reach in a 100-year flood.
Summers said Chatham wasn't given enough time to meet the federal requirements, so the selectmen sent a letter asking that it be considered an official appeal. They called FEMA's map-modeling too generalized, and complained the maps had not undergone peer review. They added that FEMA's criteria for appeal was far too complicated and expensive.
"We fully realize we haven't technically complied with the requirements for appeal," Summers said. "They were requiring science, but we wanted to at least have a placeholder."
The selectmen also included a technical paper on base flood elevations in the area written by a local surveyor. "That was the closest thing to technical data I could think of," Summers said. "It was an effort to fit in their box."
Some Chatham property owners filed their own appeals, including a group of neighbors on the north side of town and two property owners from West Chatham.
While Brewster didn't appeal risk maps, Conservation Administrator James Gallagher did submit comments on Hamilton Cartway, which had been placed in the flood zone.
"I asked about their elevation data," Gallagher said. "This is a neighborhood with hills."
A group of Dennis neighbors on Dr. Lords Road submitted a formal appeal along with some engineering to support it.
Yarmouth Town Planner Kathleen Williams said local officials did not appeal but instead sent a letter to state and federal legislators, requesting a delay of implementation of both the maps and the Biggert-Waters Act.
Williams said only one property owner sent a letter appealing the risk map designation, "but it didn't have any paperwork with it."
Several appeals from property owners in Beach Point and a single one from the Pamet Harbor area were submitted in Truro, said Charleen Greenhalgh, assistant town administrator and town planner.
They ranged from short emails to letters outlining the historical data on the property. She was unsure how many would meet FEMA's requirements.
"I blame it on FEMA for not giving good directions," Greenhalgh said. "People weren't sure how to do it. They were confused, and understandably so."
Falmouth Town Planner Brian Currie said the same was true in his community, with protests ranging from simple letters to packets with technical backup. Currie pointed out property owners would continue to have the ability to hire a surveyor and apply for a letter of map amendment, even though the appeal deadline has passed.
Meanwhile, state and federal legislators are working to delay implementation of the Biggert-Waters Act and are lobbying for a peer review of the maps.
Last week, state Attorney General Martha Coakley and House Speaker Robert DeLeo, D-Winthrop, introduced a bill that would prohibit mortgage companies from requiring homeowners to purchase flood insurance in amounts greater than the outstanding balance on their loans. The bill would also allow homeowners to opt for higher deductibles.