More homeowners are faced with purchasing flood insurance than ever before. The cost of flood insurance can be quite burdensome and especially frustrating for homeowners who have never experienced floods but whose homes are now in designated flood plains. Real estate brokers have an affirmative duty to disclose the location of properties which are in designated flood plains and which require flood insurance. The flood plain maps for Westchester County were updated beginning in 2003 and became effective as of September 28, 2007. Existing flood plain maps for Putnam County are in the process of being updated and should be finished in mid 2009.
Real Property Law §443 requires that every buyer and seller in a residential transaction involving a one to four family home be given a New York State Disclosure Form regarding real estate agency relationships. This form places the real estate licensee under an obligation to buyers to “disclose all facts known to the agent materially affecting the value or desirability of property, except as otherwise provided by law.” If a listing agent therefore knows that a property is in a flood zone (and there is an affirmative duty to at least inquire of the sellers whether they are in a designated flood zone), that information must be communicated to the purchasers or the purchasers’ agent.
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