Flood insurance rate hike endangers real estate recovery, Florida Realtors group warns

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Florida Realtors are joining state lawmakers in urging a delay in new federal rules that increase flood insurance rates for thousands of Florida property owners.

John Sebree, a senior vice president with Florida Realtors, said Monday that his association supports a delay in implementing reforms in the Biggert-Waters Act, which will take effect on Oct. 1. The act forces changes to the National Flood Insurance Program.

On Wednesday at 9 a.m., St. Petersburg realtor Brandi Gabbard of Smith & Associates is scheduled to testify before a House Insurance sub-committee in Tallahassee about how the impending rule changes already are affecting home sales.

Pinellas County property owners are projected to be among the hardest hit by rate increases. More than 50,000 properties may be affected.

Sebree said that FEMA is in the process of updating flood maps, and a lot of that work is incomplete for cities in the Tampa Bay area and the entire west coast of Florida.

“Most of the properties impacted are from Pinellas County south to Naples,” Sebree said. “No one is sure what the premium changes will be on Oct. 1,” when the reforms take effect.

Sebree noted that there are many different components to the rate insurance changes that “we’re just learning about by hearing horror stories from the field.”

He said that starting Oct. 1, a new home buyer may have a different flood insurance rate than the property owner selling the house.

“The person who owns the house may be paying a $700 premium, and the person who is buying the house must pay $7,000,” he said.

“These changes could put us at risk of shutting down our real estate recovery,” he added.