Damage caused by flooding in a home or other property can remain long after the outward signs of it have been removed. Further, even if a property hasn’t suffered flood damage, owners and prospective buyers should know if a home is in an area that features a significant potential to flood.
These are some of the reasons why after months of unprecedented flooding in New York in 2023, state lawmakers passed legislation signed into law by Gov. Kathy Hochul that amended New York’s Property Condition Disclosure Statement. It now demands information about flood risks along with asbestos, fire and smoke damage, hazardous waste and pest infestations.
What information is required on the Property Condition Disclosure Statement?
Sellers are now required to disclose the following information:
- If a property is located in a flood hazard area or FEMA-designated floodplain
- If flood insurance is required for the property
- If there has been “flooding, drainage, or grading problems that have resulted in standing water on the property”
- If there have been any flood damage claims (by the current or previous owners) or if they’ve received government assistance for flood damage.
The law was also amended to remove the option for sellers to give buyers a $500 credit on the sale price in exchange not completing the Property Condition Disclosure Statement.
The Natural Resources Defense Council (NRDC) had long advocated for the need for more flood disclosure requirements by New York property owners and for not allowing sellers to pay to avoid disclosure (something that was unique to New York). An official with the NRDC applauded the changes as going “a long way towards helping give home buyers the information they need to make informed decisions about one of the biggest financial investments of their lives — their home.”
Of course, no law can make everyone do the right thing. That’s why it’s crucial to know that if a seller isn’t fully honest and transparent about disclosing flood-related and other information, they can face a lawsuit from a buyer in addition to other penalties. Whichever side of the equation someone is on, it’s crucial for New Yorkers to have experienced legal guidance on their side, given all that is at stake.