Is Flood Insurance Affecting the Value of Your Home?

Flood insurance can have a damaging effect on the resale value of your home. Most people would rather buy more house than send money to the National Flood Insurance Program (NFIP). However, there is an option for avoiding high flood insurance premiums: flood mitigation. Mitigation can lower flood premiums by as much as 80-90%.

Common Flood Mitigation Activities
image: FEMA

The cost of mitigation is usually less expensive than the first price reduction.

Flood mitigation is the act of making a structure more resistant to flooding, therefore safer. When homes are mitigated they become eligible for lower flood insurance premiums. This is the NFIP’s way of saying “thank you” for making future storms cost less. The concept is based on a mitigated home suffering less damage during flood events which lowers the NFIP’s exposure and justifies lower premiums.

Lower premiums are good when listing a house in a required flood zone. If you are contemplating putting your home on the market you might be wondering: should you mitigate prior to listing to or just put it on the market to see what happens? The truth is there is no answer that is right for every situation. It is important to communicate with your real estate agent to help you make the right decision.

In Virginia continuing education credit for flood risk is required of all licensed real estate agents.

Expensive flood insurance is almost always going to be an objection. The more expensive the insurance the stronger the objection. Objections make the selling process longer and give the buyer greater leverage to negotiate. Removing objections prior to listing is something real estate agents do every day. Remove the clutter, fix the hole in the roof, and paint that wall. Now add flood vents to the list.

High flood insurance premiums result in a host of questions and hypothetical possibilities. Is there moisture damage? Has the house flooded before? Do the roads flood preventing me from getting to and from work? And the list goes on. As potential buyers retreat in fear the inevitable conversation about reducing the price begins. Sometimes the impact can be limited or avoided through flood mitigation.

Where flood mitigation is possible, the cost of mitigation is usually less expensive than the first price reduction. I’ve assessed hundreds of homes throughout coastal Virginia and I’ve seen how flood mitigation can make the difference between a house selling and not.

Low flood insurance premiums are usually looked upon as a benefit. They rarely kill a deal. While flood insurance is going up, premiums usually do not increase much on a mitigated structure because the NFIP considers them compliant. Selling a safer home faster, at market value is good for all parties involved.

Types of Flood Mitigation

The graphic above shows FEMA’s breakdown of the most common types of home flood mitigation.  Two other common types of home flood mitigation are flood vents and home elevation. Flood vents are used on homes built over crawl spaces. Flood vents increase the flow of water beneath a house. Greater flow reduces hydrostatic pressure and the risk a home will float from its foundation. Typically homes on concrete slabs must be elevated because there is nothing to vent. Other extenuating factors may prevent mitigation but it’s always worth it to find out if home flood mitigation is an option. You can read more about mitigation techniques on FEMA’s web site “Protecting Your Home And Property From Flood Damage“.

Flood Continuing Education

Education is part of our identity at COMPARITY. We strive to educate our clients through an unbiased comparison of their home and auto insurance. We also provide continuing education credit to real estate professionals. In Virginia continuing education credit for flood risk is required of all licensed real estate agents. Learn more about flood risk and our course at