New Flood Data Adds an Extra Dimension for Shoppers and for Research
September 1st, 2020 – Now, flood data, available on realtor.com® will enable buyers to consider the flood risk of a location when thinking about their home purchase. The flood data includes an estimate of a home’s FEMA flood zone as well as Flood FactorTM, comprehensive flood risk data displayed at the property level in the form of a score, ranging from 1 (minimal risk) to 10 (extreme risk) powered by the First Street Foundation. When available for a property, it will display the current risk of flooding for the home; whether that risk is increasing, decreasing, or constant; and the likelihood of that property experiencing a flood event over the next 30 years.
Previous research conducted by realtor.com® and featured in the Wall Street Journal found evidence that homes outside of FEMA high-risk flood zones appreciated faster than homes inside those zones between 2012 and 2017, suggesting that buyers already attempt to adjust for this risk. But most buyers are not deterred just because a home has flood risk. In a consumer survey conducted this spring by Toluna research for realtor.com®, a majority of buyers (55 percent) would still buy a home even if they knew it was in a flood zone, but roughly four in 10 buyers would expect some kind of discount on the home, presumably for the extra costs associated with flood risk. Younger shoppers were more open to buying a home with flood risk than those aged 55 and older.
The shopping experience on realtor.com® will now make information about flood risk available to home buyers, homeowners, and real estate agents upfront. It will enable buyers to factor this risk into their evaluation of the tradeoffs of buying a particular home. The data will also help buyers and owners ensure they have adequate insurance coverage, since flood risks are not covered by homeowner’s insurance policies. By helping real estate agents make this risk an early part of the home search discussion, this data may incentivize owners to make improvements to their homes that help mitigate flood risk. This information may also reduce the likelihood that a home sale is derailed by unexpected information about flood risks late into the transaction.
In the future, this flood risk data will enable research to answer questions such as how a rating affects the price of a home or how long it takes to sell. We may also be able to evaluate whether the FEMA mapping or Flood FactorTM data have different impacts on market outcomes or consumer home shopping behavior.
For assistance in finding the right home or guidance in the real estate market, Talk To Tammy – 636.931.9100!