New 2024 Flood Disclosure Law: What Florida Homebuyers Need to Know

by Scott Kaplan

Starting October 1, 2024, Florida will implement a new flood disclosure requirement for residential real estate transactions. According to Florida Statute 689.302, sellers must now provide a flood disclosure to potential buyers at or before the time a sales contract is signed.

The flood disclosure will include:

Whether the seller has ever filed a claim with their insurance for flood damage on the property.
Whether the property has received any federal assistance related to flood damage.

For the purposes of this law, “flooding” is defined as a temporary or general condition of partial or complete inundation of a property. Flooding can occur due to:

Overflow from inland or tidal waters.
Unusual and rapid accumulation of runoff or surface water from established sources, such as rivers, streams, or drainage ditches.
Prolonged periods of standing water caused by rainfall.

One important detail to note is that Florida courts are divided on whether a property's tendency to flood is considered "readily observable." If it is, sellers may not be legally required to disclose this information. However, for buyers unfamiliar with an area, flooding risks—especially seasonal ones—may not be obvious, making this disclosure vital.

Additionally, the Federal Emergency Management Agency (FEMA) designates certain homes as "severe repetitive loss properties." These are homes that have either flooded twice with damages equal to the property’s value or flooded four times with damages exceeding $5,000 each time. There are approximately 45,000 such properties in the U.S., with about 3,100 located in Florida.

FEMA shares flood history only with the property owner if they hold an active flood insurance policy. This means prospective buyers may not have access to this information prior to closing, highlighting the importance of the new flood disclosure requirement.

Lastly, standard homeowners' insurance policies typically do not cover flood damage, so buyers should consult with their insurance agents about obtaining separate flood insurance.

This new disclosure requirement provides buyers with essential information, ensuring greater transparency in real estate transactions and helping them make more informed decisions before signing a contract. As always, my team is here to answer any questions you have and help navigate the everchanging market with you!

Source: Florida Realtors®