As reported yesterday, the Natomas basin area of Sacramento had horrible news that all residents of the area that have federally backed loans will be required to carry flood insurance in their policies.

Today it was reported that somehow the city of Sacramento was caught off guard by this report from FEEMA and has sent them scrambling to sort out legal, economic and practical issues.  Mayor Fargo did not rule out a building moratorium!  FEEMA spokesman Frank Mansell said the agency's understanding was that the city wold apply to have the Natomas basin classified as an "AR" zone but would not specify what building restrictions that would entail.

This downgraded rating might have drastic effects on what was planned for an additional 8,000 new homes in the next ten years or so. 

We have not heard the last of this, but our experience that buyers has shown any issues that effect monthly payments has hampers sales in an area where you particularly have a lot of younger families and newer home buyers.  I also wonder about the liability of the Condo projects in the area.  Would love to hear from an insurance professional.