What happens when you buy a house in a disaster zone – and no one told you?

In many states, laws don’t require sellers to disclose that a property is in a flood or wildfire area, leaving homeowners with unexpected damage and losses
The house on Weber Hill Road is almost a year gone, but it still haunts Emilie Hayes. Thirteen years ago, when she and her husband Steve bought the Missouri property in a foreclosure sale, Hayes vaguely knew that it was in a 100-year floodplain. But the purchase put her children in public schools ranked among the top in the state, and the Meramec river was a whole two miles away. A trickle of a creek that cut behind the house was too small to merit a name. In Sunset Hills, flooding seemed a distant, rare hazard.
Over nearly a decade, the risk revealed itself to be greater than Hayes had known. By 2008, that backyard tributary had roared often enough that the family stacked sandbags permanently next to the beige bungalow to deflect the floodway. Then, on New Year’s Eve in 2015, a storm called Goliath helped raise the Meramec to a record historic crest of 44ft. Hayes heard a boom as water crashed through their doorway. Muddy water swallowed their basement. It covered the doorframe where she had marked the growth of four children in pencil.
“We would never live there if we could do it again,” Hayes, 45, says.
No laws require Missouri property owners to warn potential buyers about past flooding – even though the National Flood Insurance Program has paid out more than $813m in damage claims in the state, on 33 federal disasters over 40 years.
Over nearly a decade, the risk revealed itself to be greater than Hayes had known. By 2008, that backyard tributary had roared often enough that the family stacked sandbags permanently next to the beige bungalow to deflect the floodway. Then, on New Year’s Eve in 2015, a storm called Goliath helped raise the Meramec to a record historic crest of 44ft. Hayes heard a boom as water crashed through their doorway. Muddy water swallowed their basement. It covered the doorframe where she had marked the growth of four children in pencil.
“We would never live there if we could do it again,” Hayes, 45, says.
No laws require Missouri property owners to warn potential buyers about past flooding – even though the National Flood Insurance Program has paid out more than $813m in damage claims in the state, on 33 federal disasters over 40 years.
In the Carolinas, where Hurricane Florence recently dumped nearly 3ft of rain, both states require only that sellers tell buyers of their “actual knowledge” of flood hazards. South Carolina property owners must disclose whether they have flood insurance at the time of sale. In North Carolina, even where past federal aid requires flood insurance, buyers aren’t guaranteed to find out about a property’s risk. If you were supposed to have flood insurance but didn’t, says Scata, “your chances of getting federal aid are pretty slim”. Many homes in both states outside the federally designated 100-year floodplain are still drying out; for them, disclosure requirements and their consequences are murky at best.
Notification efforts for property owners vulnerable to disaster remain uneven across the US, with wide gaps. The National Oceanic and Atmospheric Administration says 2017 saw a record $300bn in disaster loss, much of it from fires.
Wildfire risk is growing, in the western US in particular, both because of climate change and because local development codes are stuffing new homes into the seam between urban and wildland areas. Since 1990, the size of such areas has swollen by a third.
No federal systems alert potential property owners where wildfire may strike next, though some states, including California and Colorado, have mapped regional hazards. Retired lawyer John MacKay, 64, says he didn’t dwell on risk when he moved to Nederland, a foothill community west of Boulder.
“It’s the natural beauty, that’s why we moved here,” he says. “I’ll go to a hospice if I want to be absolutely safe.”
Two years ago, he and his wife sold up in Florida. With a buddy, MacKay readied his new house in Colorado, getting it painted and moving in clothes, papers and other possessions. A month later, as he watched from afar in Tampa, the Cold Springs fire destroyed eight homes, including his.
“It was devastating,” he says. “We were crying for a month. I didn’t come back out right away, because what the hell are you going to do?”
MacKay’s first Colorado home was a painful education about the hazards of the backcountry, but he calls it a near miss. When he later bought a second, he was more conscious of its vulnerabilities.
Where fire risk is high, as in Boulder county, local efforts have cropped up to reduce it. A voluntary mitigation program called Wildfire Partners advised MacKay to clear wood mulch away from the sides of his house, and to remove notoriously flammable juniper trees.
“I’m very fire conscious now, as you can imagine,” MacKay says with a laugh. “I was a dumbass, no question about it. But it all worked out, and we’re happier than ever.”
Market forces offer homeowners like MacKay a glimpse of risk. Housing prices are a weak signal for disasters; despite the fires in Santa Rosa, California, for example, the median home price there has continued to climb. But the cost of insurance does tell property owners about fire and flood, if imperfectly.
“The price tag is a cue,” says Amy Bach, executive director of advocacy group United Policyholders. Bach says insurers have more experience adjusting to coastal risk and hurricanes. For homeowners risking wildfire damage, Bach argues the industry is “still adjusting”. In California, those adjustments have set off complaints about spiking rates and losses in coverage.)
Last year’s disasters reopened questions about local notice requirements. In Houston, some people lived inside a “flood pool”, an area used for emergency inundation, but beyond the boundaries of the floodplain itself. They now argue that the government should have told them about the risk. In August, California’s governor, Jerry Brown, signed a bill requiring insurers to give homeowners a replacement cost estimate for loss in case of disaster.
But informing property owners about disaster risk isn’t the same thing as reducing the risk itself, says Max Moritz, a UC cooperative extension fire scientist at the University of California, Santa Barbara. “Even perfect information isn’t the whole solution. There’s got to be some policies in place to help us where we’re not always going to make the right decision.”
Floodplain experts, consumer groups and environmentalists have pushed for a federal-level disclosure notice, under which a property’s flood history would be made public, but such federal disclosure mandates are extremely rare. Only lead paint disclosures are required by federal law at every property sale. Legislation incorporating disclosure principles in the event of flood has passed the House of Representatives, but remains stalled in the Senate.
Nevertheless, a federal notice requirement for flood risk may sound like the right thing to weary homeowners; 81% of voters polled by the Pew Foundation last year supported one.
Even though such a disclosure rule might harm him, 77-year-old Nate Timm supports the idea too. Late last month, his house in Mazomanie, Wisconsin, flooded badly.
At least 12 homes in his village have been condemned. “It just is traumatic,” he says.
Timm bought his land 47 years ago, without ever seeing a flood map; over time, he became a leader in minimizing his village’s risk of rising waters. After the town flooded three times in 10 years, Mazomanie cleaned out the floodplain, taking out truckloads of trees and debris year after year, mostly with volunteers.
Timm credits that mitigation effort with saving his village from the worst flood risk for 17 years. But he says all that work was no match for climate change, which he blames for 15 inches of rain falling in 24 hours in August.
“I’ve never seen anything like it,” Timm says.
Timm didn’t need insurance when he got a mortgage; now that it’s paid off, a policy is too expensive. With hindsight, he says he might have planned better. “Considering the impact of climate change, maybe I would have built higher. Maybe I would not have built in that spot.”
Warning prospective buyers about past flooding would make sales more fair and regional planning more effective, he insists. “How can you be smart if the information is hidden?” he asks.
But if a federal notice rule took effect, Timm suspects that would sap the value of properties like his, paid off decades ago. For older people like him, retired, middle class, a piece of land is a nest egg, security for retirement. He worries disclosure would trap them in vulnerable properties.
“If you knew that a place is in the floodplain – OK, you wouldn’t buy that place,” Timm says. “That’s fine for somebody who is coming in for the first time.”
This flood has dimmed the future at the property where he spent the last half-century. Timm says he’s thinking of giving up and moving upstate, closer to family. After taking care of his village, Mazomanie, and himself, all these years, Timm feels that, when it comes to the risk of climate change, he’s on his own.