TAMPA — Early evidence shows the flood insurance mess isn’t affecting home prices in Hillsborough County as much as originally feared, the Hillsborough County Property Appraiser’s Office said Friday.
New flood insurance rules that took effect Oct. 1 caused some homeowners’ flood insurance rates to soar. The property appraiser’s office estimated that the owners of 21,800 single-family residences in Hillsborough County could be subject to the new rates, because their homes were built before new flood insurance rate maps were introduced in the late 1970s and early 1980s.
Pinellas County is even more affected, with some 51,000 property owners potentially facing higher flood insurance rates, Pinellas’ property appraiser found.
Real estate agents, especially, feared the problem could make it nearly impossible to sell many older homes in flood zones.
So far, the worst of their fears may not be coming true.
Patrick Alesandrini, director of valuation for the Hillsborough County property appraiser, said the flood issue might scare away some buyers and prevent some sales from happening. But, it doesn’t seem to be affecting the sale prices of homes that are selling.
When the property appraiser assesses a home’s value, it’s often a bit lower than its eventual sale price. For example, the “just value” that the property appraiser determines often is about 77 percent of the eventual sale price, Alesandrini said.
If the flood insurance issue were hurting sale prices, it should show up in this ratio. For example, the just value of older flood-zone homes might amount to, say, 90 percent or 100 percent of the actual sale price.
However, that doesn’t seem to be happening, Alesandrini said. There is no distinction in this ratio between homes inside of flood zones and homes outside of them.
Looking at more than 11,500 home sales in Hillsborough County from January through October, the just values of homes are constant at about 77 percent of the eventual sale price in homes both inside of flood zones and outside them, Alesandrini said.