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New Research Shows Cost of Flood-Risk Secrecy for New York Home Buyers

Woodside, Queens is the perfect residential neighborhood – until it rains. 

“You can see lights turn on [along] the whole neighborhood,” said Tenzin Woe, a computer science student who moved with his parents from nearby Astoria to Woodside in 2017. Since then, leaking and mold are the “norm” when it rains more than an inch. The family has lived through three major floods. 

“Everyone’s just watching,” he said, pointing toward a makeshift wall of sandbags between a drain and the bottom of his driveway. Hurricane Ian was just two days from making landfall on the East Coast. “We’re just watching this sewer, waiting for it to flood.” 

No one told the Woes their house was so flood-prone.

The New York State Assembly passed a bill in May, sponsored by Assemblymember Robert Carroll, mandating that landlords warn renters about flood risk before they put down a deposit. But an earlier draft, which would have extended the same protection to buyers like the Woes, succumbed to last-minute edits requested by real-estate lobbyists. As the East Coast braces for the final weeks of Hurricane season, thousands continue to move into flood-risk homes without ever being warned.

“It’s our fault for not knowing,” Woe said. But his family couldn’t have known. 

Like many low-lying New York City neighborhoods that flood with increasing frequency, Woodside isn’t technically on a floodplain or wetland. The Federal Emergency Management Agency (FEMA) won’t disclose a property’s history of flood insurance claims because of the Privacy Act of 1974. Only once the title has transferred to a new owner and they request flood insurance through the agency will FEMA share a record of previous claims.

Worse, under a 2001 “loophole” in state law, whoever sold the Woe’s their $800,000 home five years ago paid $500 specifically to avoid warning them. The law created a “Property Condition Disclosure Statement” with fields for flood history and other potential hazards – but the same provision also allows the seller to absolve themself from filling out the form at all if they pay the buyer a $500 credit when the title is transferred. 

A new study conducted by insurance company Milliman, and commissioned by the environmental advocacy group National Resources Defense Council, sheds light on how common the Woe’s experience is. Of every home sold in New York last year, one in 20 had a history of flooding. Each of these 7,500 flood-risk houses can expect 30 times more damage in the future than a safe one, the study predicts. 

The findings came in August, too late for advocates working with lawmakers to close the loophole in this year’s Assembly session. 

“It’s a piece that was missing during our advocacy when we were going to bat for legislation this summer,” said Tyler Taba, Senior Manager for Climate Policy at Waterfront Alliance. With over a hundred other civic, charitable and residents’ organizations, Waterfront Alliance spearheads Rise to Resilience: a coalition calling for several policies to protect New Yorkers from climate impacts, including stronger flood disclosure legislation. 

“A lot of legislators were curious to know what the economic side of this was, and there was no data on that,” Taba said. 

The study now shows that New York suffered $23.6 million of flood damages last year to houses alone, not counting apartments. Using a combination of historic insurance claim data and storm surge modeling, it predicts New Yorkers living in previously flooded homes can expect to lose $3,125 a year in damages from future flooding.

It wasn’t just a lack of data which stopped legislators. The New York State Association of Realtors (NYSAR) confirmed that they lobbied to keep the $500 “option” for sellers. 

In “direct conversations with lawmakers,” NYSAR’s Director of Government Affairs, Mike Kelly, claimed that mandatory disclosure is not worth “the disruption it would cause the marketplace.”

“I’m not sold on that,” said David Pechefksy, Legislative Director for Assemblyman Carroll, who proposed closing the loophole. “Texas, for example, passed a law that has this kind of disclosure requirement and it didn’t cause disruption.”

Far from the Assembly in Albany, Hurricane Ian, downgraded to a post-tropical cyclone, hit Woodside at the very start of October. The tail end of the storm still brought enough rain to put the neighborhood on edge and flood the Woe’s basement with two inches of water.

The family set to work on the same repairs as always – bleaching mold, plastering over new cracks and repainting the walls – but Woe says the worst part is always the rotting smell. 

“It’s shady,” said Woe. “It doesn’t feel right. We had no idea.”

Written by

Daniel Shailer is a freelance climate reporter and student at Columbia School of Journalism.