N.C. Real Estate Commission agrees to draft new flood disclosure rules

N.C. Real Estate Commission agrees to draft new flood disclosure rules

February 19th, 2023

The North Carolina Real Estate Commission is moving forward on a petition from the Southern Environmental Law Center to add flood-related questions to the disclosure form sellers must provide to potential buyers.

The nonprofit law center filed the petition in December on behalf of the Natural Resources Defense Council, or NRDC, the North Carolina Justice Center, equity-advocacy group MDC Inc., the North Carolina Disaster Recovery and Resiliency School, the Robeson County Church and Community Center, and NC Field, an advocacy group for more inclusive communities.

Janet B. Thoren, legal counsel with the commission, explained Monday that the petition was granted during the commission’s meeting Feb. 15 in Raleigh and that the commission was working to change the required disclosure form to include additional questions about flood-prone properties on the coast and elsewhere in the state.

NRDC Senior Attorney Joel Scata said in a statement that buyers in the state had been kept in the dark about flood risks when choosing where their family will call home.

“The Real Estate Commission’s decision to grant the petition rectifies the fundamental unfairness of not requiring home buyers be told about a property’s flood history,” Scata said. “This is an important decision that puts North Carolina in the vanguard with states like Louisiana and Texas that ensure that home buyers are given clear and necessary information about a home’s flood history before purchase.”

A recent study found that North Carolina homebuyers could incur tens of thousands of dollars in unanticipated damages over the lifetime of their mortgage due to the state’s weak disclosure requirements, according to the Southern Environmental Law Center. An NRDC analysis found that the state has some of the nation’s weaker disclosure policies when it comes to flooding, and a 2022 FEMA analysis found North Carolina’s disclosure requirements to be severely lacking.

“Lower income households bear a disproportionate burden of the risk and costs of flooding,” said Andrew Loeb Shoenig, program director for Durham-based MDC Inc.

Southern Environmental Law Center Senior Attorney Brooks Rainey-Pearson said that the commission’s decision would help ensure that homebuyers in the state know the flood history and flood risks that come with a house.

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