WASHINGTON, D.C. – (RealEstateRama) — Ed Brady, chairman of the National Association of Home Builders (NAHB) and a home builder and developer from Bloomington, Ill., today issued the following statement on the U.S. Department of Housing and Urban Development’s proposed regulations regarding floodplain management:
“This proposed rule from HUD regarding implementation of President Obama’s executive order on floodplain management will severely disrupt the housing market and harm affordability for millions of Americans living in areas that are designated under an expanded floodplain definition, where in many cases the odds of facing a flood event are extremely remote. Moreover, HUD has vastly overstepped its bounds by proposing new rules that are inconsistent with the requirements for new construction under the National Flood Insurance Program.
“HUD must stick to the original intent of the president’s executive order by stipulating that expanded floodplain rules only apply to federally funded projects – and not unnecessarily expand this definition by imposing costly requirements on the FHA multifamily and single-family mortgage insurance programs.
“Multifamily structures face an added burden under HUD’s proposed rule as they will have to comply with mandatory elevation requirements for new construction or substantial rehabilitation in areas outside of the 100-year floodplain in order to qualify for HUD-insured financing. And single-family homes aren’t off the hook. The proposal would require all new and substantially improved single-family homes within 100-year floodplains to elevate two feet above the 100-year base flood elevation when FHA financing is involved.
“In short, HUD’s proposal is a disaster for housing affordability. It will trigger delays and higher construction costs for properties facing little risk of flooding. In turn, these costs and delays will make housing cost-prohibitive for working families in communities located in and around floodplains.”