Updated August 31 at 6:31pm

Higher flood-insurance rates may swamp owners

By Patrick Anderson
PBN Staff Writer

The odd hours and unexpected demands of a real estate agent mean the job is not for everyone, even those with a passion for property. For Susan Arnold, having to respond to a client call the night before her wedding convinced her to look for more predictable work and she found it in corporate purchasing with Pratt & Whitney. But after night school produced a law degree, Arnold was drawn back to real estate, first as legal counsel and eventually CEO of the Rhode Island Association of Realtors, where her combination of corporate, legal and real estate experience was a good fit. Now in her second decade with the Realtors group, Arnold is trying to help her members negotiate challenges like the government shutdown and changes to the National Flood Insurance Program. She says flood insurance in particular - with new maps and the phasing out of subsidized rates for old homes - has caused significant anxiety in the housing market.

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Higher flood-insurance rates may swamp owners

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The odd hours and unexpected demands of a real estate agent mean the job is not for everyone, even those with a passion for property. For Susan Arnold, having to respond to a client call the night before her wedding convinced her to look for more predictable work and she found it in corporate purchasing with Pratt & Whitney. But after night school produced a law degree, Arnold was drawn back to real estate, first as legal counsel and eventually CEO of the Rhode Island Association of Realtors, where her combination of corporate, legal and real estate experience was a good fit. Now in her second decade with the Realtors group, Arnold is trying to help her members negotiate challenges like the government shutdown and changes to the National Flood Insurance Program. She says flood insurance in particular - with new maps and the phasing out of subsidized rates for old homes - has caused significant anxiety in the housing market.

PBN: Are buyers, sellers and agents coming to grips with these new flood-insurance rules or is it still chaotic?

ARNOLD: We are in transition. We are desperately trying to get more information so we can give it to clients. These are not straight-line changes and each piece does not fit together neatly. We had a survey collecting data for Sen. [Jack] Reed [D-R.I.] because he is studying the rollout of the program and affordability to the average homeowner. [The Federal Emergency Management Agency] never completed its affordability study to see how many transactions have been affected and how many properties were previously in another zone and paying higher rates. Anecdotally we have heard the highest rates are $49,000 per year. That will have a big impact on the value and affordability of those properties. We want to know which homes this is hitting the hardest, modest or most expensive. Right now it seems to be across the board. Decrease in value of property could be as little as $5,000 and as much as $100,000.

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