HUD Homes More Likely to be in Floodplains
Industry Update
September 13, 2021
Source: Inman
Repossessed homes sold by the Department of Housing and Urban Development between 2017 and 2020 were almost 75 times more likely to be in federally designated floodplains than other homes sold during that timeframe, according to an analysis of nearly 100,000 homes sales by NPR.
HUD is not required to disclose flood risk to would-be homebuyers, most of whom didn’t learn that the home they were interested in was located in a flood zone until they were told by their lender that they needed to buy flood insurance, NPR found. By then, many had already made an offer or paid a nonrefundable deposit.
In some cases, HUD sold homes in flood-prone communities where local officials were trying to buy up homes and knock them down to prevent future calamities, including “severe loss properties” that had been rebuilt multiple times at taxpayer expense.
NPR’s investigation concluded that HUD could work more closely with the Federal Emergency Management Agency (FEMA), “which produces flood maps, provides flood insurance and allocates money for climate-related mitigation projects such as raising houses.”
For full report, please click the source link above.
