Hikes in Federal Emergency Management Agency flood insurance rates are affecting the real estate market in Hoquiam and Aberdeen, real estate agents and homeowners say.
Particularly hard-hit are people who own or occupy property in low-lying areas because of new FEMA maps for this region and national flood insurance reform passed in 2012.
The flood insurance program was created to help protect property owners from risk due to flooding and was amended to bring rates more in line with actuarial risk and make the program solvent.
But because insurance premium increases are proving higher than expected, the Senate voted late last week to reform the reforms. Action is still pending in the House .
“The government has got to do something to change this. This will make real estate for lower income people unaffordable here,” said Premier Realty broker Harley Greninger.
Nancy Webb, who wants to sell family property in Hoquiam to a buyer across the street. The home was bought by her grandparents in 1905 and was grandfathered in for flood insurance rates so Webb said she didn’t pay much.
But now that she’s selling it, new owners won’t receive the lower rates, making the sale more difficult. They wanted to buy the home as a rental or a bed-and-breakfast. When they discovered flood insurance could run as much as $9,000 annually, they decided to hold off. Some of that increase is because the property would be used as a business.
“Where is our congressman, Derek Kilmer?” asked Murrell. Kilmer is a co-sponsor of the House bill to amend or delay current changes to the FEMA laws.