“Nine out of 10 of my buyers say, ‘I don’t want to look at houses in a flood zone,’ ” said Valerie White, a Re/Max agent in Oakland. “Those storms really damaged those property owners.”

For prospective home buyers, flood zones hold two scary risks. First, there’s the obvious and very unpleasant threat of water in the basement or, worse yet, the living room.

But there’s also a large, and growing, financial risk in the form of flood insurance. The National Flood Insurance Program, part of the Federal Emergency Management Agency, has begun increasing premiums and phasing out federal subsidies on the policies”

According to Jeffrey Otteau, an East Brunswick appraiser who tracks the real estate market statewide, home sellers with high flood insurance premiums generally have to discount their asking prices significantly, to offset the monthly cost of the insurance.

For example, he said, if your flood insurance is $2,500 a year, that’s equivalent to the monthly payment on $45,000 in mortgage money — suggesting that the home would have to be priced about $45,000 lower than similar homes that don’t require the insurance.


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