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NC petition calls for stronger flood disclosures

The petition would require home sellers to disclose past flood damages

The Southern Environmental Law Center petitioned the North Carolina Real Estate Commission to require sellers to disclose information about past flood damages to potential homebuyers.

The petition was filed on behalf of Natural Resources Defense Council (NRDC), North Carolina Justice Center, MDC, North Carolina Disaster Recovery and Resiliency School, Robeson County Church and Community Center, and NC Field.

The aim of the petition is to help buyers make informed decisions about their home or investment purchases considering the risk of flooding at a property. It also requests an amendment to North Carolina Real Estate Commission’s mandatory disclosure form, a requirement of The Residential Property Disclosure Act, to ask for more information about flood history and risk.

“It’s common sense to give North Carolinians the necessary information to know if they will need flood insurance before buying a property,” said Brooks Rainey-Pearson, senior attorney at Southern Environmental Law Center, in a statement. “The Real Estate Commission can help level the playing field for homebuyers in North Carolina and make sure that they know about the flood risks that come with a house.”

The Real Estate Commission currently requires property sellers to disclose if a property is located in a floodplain or is subject to a flood hazard. 

The language used in the North Carolina disclosure does not, however, share a property’s flood history, which includes actual damages, costs of flood insurance and whether previous owners received federal disaster assistance, according to the release.

On the other hand, states that are prone to floods and hurricanes like Louisiana and Texas require sellers to provide homebuyers a home’s flood history before purchase.

Joel Scata, senior attorney at NRDC, says it is unfair to buyers if they are not aware of all relevant information before they choose a property.

“A home that is flooded once is likely to get hit again, and buyers should have the right to know that information given how costly flooding can be for a homeowner,” Scata added.

A study by independent actuarial consulting firm Milliman, appointed by NRDC, found North Carolina homebuyers incur losses for damages owing to the state’s disclosure requirements. The report states that North Carolina, New Jersey and New York have inadequate disclosure requirements.

According to NRDC research, more than eight in 10 voters in North Carolina favor a strong flood disclosure, with bipartisan support for making homebuyers aware of flood risks to their preferred properties.

“Flood disclosures are vital in inland communities where potential buyers may not even think to ask about the real and significant risk of flooding that comes from rain generated by a hurricane,” said Brittany Love, director of systemic programming at the Robeson County Church and Community Center in Lumberton, in the release.