New York Senator Chuck Schumer and other East Coast politicians are calling for Congress to delay parts of the Biggert-Water Flood Insurance Reform Act, which ends federal flood insurance subsidies and, opponents fear, will send property values crashing.
According to an Oct. 10 article in the New York Daily News, most residents of waterfront areas are required to have flood insurance to prop up their mortgages in the event of disaster. But the cost of that insurance could rise to $30,000 a year once the federal government draws new flood zone maps. East Coast politicians are discussing how to keep flood insurance premiums affordable.
Homeowner groups said the hikes could severely affect their communities.
“It’s going to be a tremendous hardship,” said Hank Iori, president of the Belle Harbor Property Owners Association, which represents families in the Rockaway peninsula community.
The new premiums are expected to lead to a steep drop in property values.
“The exorbitant rise in flood insurance premiums is going to have a massive negative impact on the housing market,” said George Kasimos, founder of Stop FEMA Now, which is trying to halt the rate jump. “It is going to make the 2007 housing bubble look like a walk in the park.”
Once the new maps are drawn, about 9,000 Queens, New York homeowners are expected to be placed in a flood zone for the first time. And about 23,000 Queens’ borough families are expected to be affected by the higher premiums.
“Most families don’t have any additional income in their budgets to handle an outrageous increase,” said Dan Mundy Jr., president of the Broad Channel Civic Association, which represents about 2,000 families. “Some families will walk away from their homes.”
FEMA officials could not be reached for comment due to the government shutdown.
