If you own a home in Florida, you’re no doubt used to the hurricanes and resulting flooding that often occurs within the state. Florida has one of the largest flood insurance markets in the country, holding about 38% of National Flood Insurance Program (NFIP) policies nationwide.
Flood insurance is typically separate from home insurance and covers water that comes from the bottom up, not water that comes from the top down, like burst pipes. If you’ve experienced flooding in your home and want to sell it due to the damage, you have several options to choose from. Before you make a final decision, you should determine what is covered by insurance. If the flooding resulted from a natural disaster, you might qualify for disaster assistance.
In this post, we’ll help you weigh your options and walk you through how to sell a flooded or hurricane-damaged home in Florida.
Steps to Determine If You Should Sell Your Flood-Damaged Home
Whether you want to sell your home or keep it, you’ll need to consider the level of damage to your home, the financial burden you face with fixing the house, and the emotional toll that losing your home to flooding can have on you and your family.
Our goal is to help you weigh the options and figure out the best course of action for you and your family.
1. Contact Your Insurance Company
Flood insurance is different from homeowners insurance. Your homeowners insurance may cover you from sudden and accidental water damage like burst pipes or leaks from a failed appliance. But standard insurance won’t help you with flood damage from rising water outside your home, like a storm surge and overflowing rivers.
If you do have insurance, contact your provider immediately to see what is or is not covered. Your deductible and coverage will vary based on your plan.The National Flood Insurance Program (NFIP) has coverage options of up to $250,000 for the building and $100,000 for building contents.
There are different types of flood insurance coverage. Building coverage includes things like electrical systems and fuel tanks; contents coverage includes your belongings like furniture and valuables; or you can have both building and contents coverage.
If you have a federally backed mortgage, such as an FHA loan, and live in a high-risk flood zone according to the FEMA flood maps, you are required to have flood insurance. However, this isn’t required of all Florida homeowners. Because there’s a 30-day waiting period from the date of purchase until your policy goes into effect, you won’t be able to purchase flood insurance retroactively or after the damage has already occurred.
2. Check if You Qualify for Disaster Assistance
You might be able to apply for assistance at DisasterAssistance.gov if your home was flooded because of a natural disaster, which is only determined by the president.
You could also call FEMA’s disaster assistance toll-free number at 1-800-621-3362 to understand your options. FEMA could assist with rent or lodging expenses while you wait for your home to be restored, which is not covered by flood insurance. To receive assistance, you must meet these eligibility requirements:
- U.S. citizenship or qualified non-citizens
- Identity verification
- Ownership/Occupancy verification
- Proof of unmet needs after insurance
You could also qualify for low-interest loans from the U.S. Small Business Administration. If your house is extremely damaged, you could also qualify for a buyout. In a buyout, the local government will buy houses that owners can no longer live in. Once you have a better idea of the relief you can receive, you can begin to determine your next steps.
Homeowners may be eligible for a property tax refund if a catastrophic event occurs. You can receive this refund if the damage renders your home uninhabitable for at least 30 days.
3. Document the Flood Damage to Your Home
Make sure you take a full assessment of the damage to your home. Take photos and videos of the damage; you should also take close-ups of affected areas.
Here’s a quick checklist to help you account for all the damage to your house:
- Take photos and videos of the inside and outside. Document all damage and record the water levels. The deeper the water, the more damage to your home.
- Note any damaged belongings. Appliances like your heating, ventilation, and air-conditioning systems could have been damaged, as well as other things like outlets or electrical boxes. Note the serial numbers of any appliances that were damaged so you can try to replace them.
- Check for structural damage. Water can easily damage the structure of your house. Keep a lookout for loose flooring or cracks in the foundation around your house.
- Keep material samples. Collect samples of items like flooring, upholstery, and window treatments. The quality of the material can impact your insurance claim, so keep them safe in zippered plastic bags if you can.
- Save your receipts. These are essential to submit to your insurance company for reimbursement.
4. Get Professional Estimates to Weigh the Costs
FEMA estimates that just one inch of flood water can cause around $25,000 in damage. The cost for repairs can add up quickly, becoming expensive as the cleanup of a house flood moves through three phases: mitigation, remediation, and restoration. All three of these phases will cost you.
Do your best to get estimates from various water damage restoration companies and contractors and have them complete a home inspection. Your insurance company may have trusted partners that they recommend, so call or check their website for ideas. You should have an itemized breakdown of the costs, as your insurance company will need this information to work through your claim. You might consider hiring an appraiser, which might be a stretch to your budget.
If you are planning to rebuild, FEMA has a special regulation called the 50% Rule, which limits the cost of repairs to a structure in a Special Flood Hazard Area (SFHA) to 50% of the home’s pre-damage market value, excluding land value.
If the repairs exceed 50% of the home’s market value, the owner must make improvements to comply with current flood regulations. This often requires costly upgrades, such as elevating the home above the foundation. It’s essential to factor this into the total cost of repairing your home.
5. Weigh Your Decision to Sell or Make Repairs
You will need to decide if you should sell the house or make necessary repairs to it. A pros and cons list might help you decide what to choose.
- What money are you getting back from insurance? Once you consider the amount of money you’ll get from the insurance policy and have to cover out of pocket, you’ll be able to determine if you can repair it before selling it or if it’s too expensive to bear that burden.
- When would you like to sell? If you want to be out quickly, then you should consider selling to a cash home buyer like Florida Cash Home Buyers. If you want to make repairs, you’ll have to factor in the time it’ll take to get repairs done and sell.
- How are you feeling about the house? Maybe the experience was so traumatic that you just want to get out ASAP. Based on that, you may want to consider selling as-is.
- Could recurring weather result in another flood? If you’re in an area where floods are common, you might think about whether you want to go through another potential flood again or if you’d rather sell and move elsewhere.
- Will a decrease in property value long-term be a problem? If it leaves you with negative equity in your home, or if the market value drops so low that you can’t cover the mortgage, that’s an issue. You may opt to sell to a cash buyer if you don’t see the value improving later down the road.
Options for Selling Your Flood-Damaged Home
You have three options for selling your flood-damaged house: make repairs before selling traditionally, sell as-is traditionally, or sell to a cash home buyer as-is.
Florida law 689.302 requires that homeowners fill out a specific flood risk disclosure form. The format of the form can be found within the law.
Make Repairs Before Selling Traditionally
If you want to sell at a higher price or have a long term plan to sell, you can remediate and repair the flood damage. However, disclosure laws still require you to inform buyers of the home’s flood history.
The average cost to repair water damage is anywhere from $1,361 to $6,270, depending on how bad the damage is. If you have flood insurance, reach out to them to see what they cover and remember that home insurance typically doesn’t cover flood-related damage.
Pros
- Higher selling price potential
- Appeals to a wider range of buyers
Cons
- Upfront repair costs
- Requires hiring a real estate agent
- Time-consuming process to repair and find a buyer
Sell Traditionally As-Is
You can sell your house without making repairs, but that will make it more difficult to find a buyer. To counter this difficulty, you could offer the buyer credit up front to help them make the repairs independently. You will also need to disclose the flood history, whether you have contacted insurance about the flood, and if you’ve filed a claim.
Pros
- No repair costs
- Faster than repairing and selling
Cons
- Lower selling price potential
- May need to offer a repair credit to attract buyers
- Can take time to find a buyer
- Requires hiring a real estate agent
Sell to a Cash Buyer like Florida Cash Home Buyers
Another option is to sell your house to Florida Cash Home Buyers if you don’t have the money or time to make repairs before selling your house. You’ll be able to sell your house as-is and receive cash quickly. The process is swift — you can contact us, receive a written cash offer, close, and receive the funds in 30 to 60 days.
Pros
- No repair costs
- Fast and simple process
- Quick cash payment
Cons
- Lower selling price compared to repairing and selling
At Florida Cash Home Buyers, we pride ourselves on being honest and open about how our process works and how we calculate the cash value of a house. If you’re curious about how much you’ll lose selling your house as-is, read our article where we break down different scenarios and cover the pros and cons.
Resources and Support for Flooded Homes
Below are some resources that can support homeowners experiencing flood damage to their homes.
- FEMA: FEMA is a source that provides financial assistance for temporary housing, home repairs, and disaster-related expenses when the recipient is not insured or cannot otherwise meet those needs.
- Florida Department of Financial Services: With this department, you can get guidance on filing an insurance claim and how to choose between different options for flood-related damage.
- The Florida Housing Finance Corporation: This entity offers low-interest loans or grants to assist you with repairs.
- Support groups: There are sources where you can find information during a disaster. These include the Community Crisis Hub of Central Florida and the Florida Nonprofit Alliance.
Sell Your Flood-Damaged House to Florida Cash Home Buyers
Florida Cash Home Buyers can calculate fair offers based on the home’s current condition, the home value, and market trends. Contact Florida Cash Home Buyers for a free, no-obligation offer to find out what you could get for your home. With Florida Cash Home Buyers, you can explore this option without risk and decide if it’s right for you. Talk to Florida Cash Home Buyers today to sell your house fast!