On the same day the federal government grinds to a halt, more than 268,000 Florida homeowners will face a hit to their pocketbooks because of federal inaction on another front — rising flood insurance rates.
Gov. Rick Scott, Chief Financial Officer Jeff Atwater and Sen. Bill Nelson have appealed to congressional leaders to delay the Oct. 1 start date of a key provision of the 2012 Biggert-Waters Flood Insurance Reform Act, a new law that phases out subsidies on older properties in flood zones. Scott is planning a news conference in Clearwater on Tuesday to demand Congress fix “the unfair national flood insurance rate hikes on Florida families.”
Under the law, 13 percent of the 2 million homeowners who carry flood insurance in Florida will be affected by the rate increase — compared to 20 percent of all policyholders nationwide.
Those homeowners will see their rates rise 25 percent upon renewal until they decide to sell their homes, then the new buyer will have to pay the full cost of that insurance — in some cases as much as 3,000 percent more than current rates — to reflect the true flood risk of their property.
The result is having a chilling effect on real estate sales as buyers balk at closing on purchases of older homes that now carry the subsidized rates, said John Sebree, senior vice president at the Florida Realtors Association. Story here.