I wanted to make sure to get in front of you to talk a little bit about this flooding and how it affects anyone whether you're a homeowner, a home seller, or someone that wants to buy a home. Flooding is not something that we've had to deal with a lot in British Columbia. Of course, there's the odd event, but we certainly haven't had anything like this in many, many years, and a lot of it is likely driven by climate change. In fact, the term atmospheric river is something I've never heard in my lifetime until now And after the events of last week that caused so much of the flooding, it certainly seems like it's a term we're going to be hearing more and more. This video is to help you understand about insurance on properties related to flood risks, the role that Realtors play in transacting properties, what the responsibilities are of a seller to disclose flooding potential, and what we can likely do better, moving forward. 

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So after this catastrophic flooding has occurred in the lower mainland and all over BC, it's a great time to chat about the things mentioned earlier. When it comes to insurance, you need to know that as

a homeowner, your standard insurance policy likely does not cover Overland flooding. Having a backed up sewer or a burst pipe in your home is something that most insurance policies have as standard, and you would simply just pay a reasonably small deductible in terms of the destruction cause, for a water leak, to either be replaced or repaired. Overland flooding is a completely different issue though. Overland flooding is an optional add on to your insurance and is honestly relatively new to British Columbia, the premiums really aren't that bad, but as you would expect, they range based on the risk of your property that's involved. A scary stat, however, is that 5% of BC residents can't even get this type of insurance due to their location. People in the Sumas Prairie area of Abbotsford are likely in this camp as well.

So what role do Realtors play in making sure that homebuyers are aware of what they're getting into when they're buying a property that may be subject to flooding.

Well, to be honest, Realtors don't get a lot of training on floodplains and areas that may be affected due to climate change. In my own 15 years of being a realtor, I think I've heard of floodplains brought up maybe one time and from years of having experience is the only way that I’ve learned to check the flood risk

and potentials for homes that are in floodplains for either the people that were helping buy or sell.

Now, one way that Realtors do help home buyers, however, is by suggesting they put a condition into any offer to purchase a property, that they get an insurance quote and speak with an insurance professional. Interestingly enough, though, I don't believe that insurance professionals have an obligation to disclose whether a property is in a floodplain or not. I may be wrong. So if you know the answer to this, please comment below.

Certainly those in the insurance industry, though, are highly responsible to advise their clients of the risks of a property being in a floodplain or experiencing a flood and should be offering the appropriate advice. After all, they are the experts in insurance.

Something that makes me and likely view a little distraught is that Realtors have actually been lobbying since 2014 to get updated flood maps and get the provincial government to really pay attention to this danger.

You can likely guess that Realtors, like many other industries, lobby the provincial government all the time and even have a special session at the British Columbia Legislature every year called Political Action Committee Dates. This is where we meet with MLAs from all over the province to let them know about things that we're worried about. In the past, we have lobbied for things like setting standards for homebuyers on protection of remediated marijuana grow operations, and centralizing that data, updating the threshold level for the property transfer tax to levels more in line with our home prices. And likely you guessed it updated Flood Maps. I know that we've lobbied because I've been there many times as my role on the Fraser Valley Real Estate Board of Directors and as the President back in 2019. 

If I had a good update to report to you on all this lobbying, though, I'd share it with you. All of the items I've just mentioned have never been addressed yet. They have fallen on deaf ears and are all things that would really improve the livability of our province, as well as help those either buying or selling real estate.

Now, this video is not to throw the government under the bus. However, they do play a large role in helping us protect the public, and today very little action has been taken on any of these items to further prove a point in this. A simple search on the BC Government’s website regarding floodplain maps by regions will show you that the maps are incredibly outdated. The Fraser River has a flood map near Hope, which was updated back in 1987. The Vedder River in Chilliwack has a flood map that was last updated in 1981. And for those of us living in the lower mainland, the Serpentine River, which runs through most of our communities, has not been updated since 1994.

BC clearly needs to step their game up in terms of making good information available to residents and potential newcomers to British Columbia. Now, after all this, you may ask yourself whether the seller of a home has a responsibility to disclose to a buyer whether their property is located in a floodplain, or maybe even if they've ever even had floods. The answer to this is maybe, but likely not. When we list a property for sale, we have sellers fill out something called a property disclosure statement, which asks them a variety of questions, including whether they are aware of any water problems or damage. There is currently nothing in this form however, regarding flooding.

There is, though, questions about whether they are aware of something called the material latent defect. This has a range of context to what a material latent defect is, but the one being most relevant is the responsibility to disclose a defect that may involve a great expense to remedy. Based on the Real Estate Services Act, Realtors must disclose if they know that the sellers are aware of the material latent defect, but sellers do not necessarily need to do this. There is ambiguity about something and whether it's actually been fixed, and if it's been fixed, doesn't need to be disclosed. Also, the seller has no obligation to fill out this property disclosure statement and could instruct their realtor that they choose not to disclose the defect. 

As a Realtor, We must then refuse to provide real estate services to that client because we have an obligation to protect the public. However, this does not prevent the seller from getting another agent to list their home and simply omit telling them about the home's history. The interesting thing about latent defects, though, is the question of whether the defect was easily discoverable under common law in British Columbia, the onus is on the buyer to satisfy themselves about the quality of the real estate being sold. It is the buyer's job to find any patent defect being one that is discoverable by a reasonable inspection or a reasonable inquiry.

Now ask yourself, Is it reasonable to buy a property in the Sumas Valley near a river and consider whether it might be in the floodplain and to check with the appropriate authorities prior to buying it? It's a tough question. Extreme weather events related to climate change have already changed the industry for many, and there is more to come.

As an example, in Miami, it's a requirement of the Miami Dade County Code that any purchaser of a home in a special flood hazard or coastal high hazard area, also known as flood zones, include a full disclosure to the buyer that the property lies in either one of those zones. If the structure substantially damaged or improved, it may, among other things, be required to be raised to the current flood elevation levels. The seller is also required to include a clause in their contracts when selling the home, making the disclosure that is mandated to be at least a 10 point, bold face, that the home is located in this special flood hazard area and what the consequences of owning it might be.

So what can we all do moving forward to make sure everyone is protected and understands the risk of being in a flood zone? Well, for starters, it should be a mandatory disclosure by the seller to the buyer, by the insurance companies and by the Realtors. Buyers need to be extremely aware of what they're getting involved with, and this isn't just limited to properties in floodplains. This is also properties near oceans like Crescent Beach and White Rock or downtown Vancouver, or anything near a river, anything near a floodplain or a low lying area like Cloverdale. We also need better training across all industries, including better training for Realtors, to help update the risks of climate change so we can let our clients know and not just limited to flooding, but everything like heatwaves, wind, earthquakes and whatever else might come our way. And this also carries over to better training and disclosure by insurance agents as well.

Lastly, we really need the government to step up on this. Having floodplain maps that are over 20 years old is just not acceptable, especially in today's day and age. When we know climate change is a real thing and is really happening, these things need to be taken seriously by those that lead us and that we employ to govern. With all stakeholders working together, including Government, Realtors, Insurance and more. We can be sure that homeowners, home sellers and home buyers are all protected. Thanks for watching this video and let us know what you think by commenting below.

At the Germyn Group, we know you only got one chance to buy or sell your home, so we're here to help you get it right.

Thanks for watching.

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