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Flood Insurance and Florida Homes

As you may have heard about recently, major flood insurance rates are coming down the line for all of Florida.  If all regulations are approved, this could cause a realignment of rates as great as $8k per year on some homes.  There will be no grandfathered clauses included.  Over the next 5 years all residents will have the new rates phased in.  This will put a serious hamper on waterfront home pricing that are below base flood elevation (BFE).

My expectation is home pricing on those below the BFE will become about $30k cheaper to account for the $8k annual insurance increase.

On the bright side of this coin however.  Those that are at or above BFE will see their rates drop which will increase the value of those homes by about $15k to $20k.  This can be guesstimated by dividing the annual insurance cost by 12 months and estimating that every $60 drop in monthly payment allows for a $10k greater purchase price on a monthly payment basis.

The lesson here is to wait if you are buying below base flood elevation and buy now if you looking at or above BFE.

Further legal action may be taken to delay rate hikes.  Stay tuned.

Feel free to contact me to discuss Tampa Real Estate further






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