Citizens sinkhole changes to boost real estate market

Nov. 21, 2013 – Citizens Property Insurance Corp. yesterday announced underwriting changes that will make thousands of previously uninsurable Florida homes eligible for homeowners’ insurance.
 
Florida Realtors advocated for the changes, which took effect Oct. 31. They allow Citizens to write policies on homes that had repaired sinkhole damage but were previously ineligible because the repairs either exceeded policy limits or weren’t done according to a structural engineer’s requirements. To qualify under the new guidelines, property owners must provide proof that repairs were made, including certification from a professional engineer, receipts and photos.
 
The announcement was made during a luncheon at the West Pasco Board of Realtors attended by nearly 300 Realtors from Pasco and Hernando counties, legislators and representatives of the insurance industry.

“What happened yesterday directly benefits 20,000 property owners – many of them elderly,” says Greg Armstrong, broker-owner of Coldwell Banker F.I. Grey & Son Residential Realtors, New Port Richey. “Indirectly, though, it benefits the entire Tampa Bay area.”

Realtor Bob Memoli agrees. For nearly a decade, he’s had transactions repeatedly fall apart because buyers couldn’t obtain mortgages without insurance, and owners weren’t able to sell because they couldn’t prove to an insurer that sinkhole damage had been repaired.
 
“My whole market is located in ‘sinkhole alley’ (Hillsborough, Pinellas, Hernando and Pasco counties),” says Memoli, a broker with Floridian Luxury Realty in Trinity, Fla. “Imagine the impact to home values, community values and quality of life if the only buyers were investors. It would be devastating.”

Citizens officials began to understand the problems some homeowners and buyers faced through talks with Florida Realtors, which led to the change.

“We’re Realtors’ connection to Florida government, which covers a lot more territory than just the Florida Legislature,” says Trey Goldman, legislative counsel for the association. Goldman says he appreciates “Greg, Bob and the other Realtors who brought this issue to our attention. We try to be responsive to our members and believe this will be a big benefit to the Tampa Bay-area market.”
 
In related news, state Sen. Wilton Simpson (R-Trilby), filed a bill this week (SB 416) that would create a new Citizens Property Insurance Corp. sinkhole-repair program. Among other things, the program would require that Citizens-approved contractors make repairs at a fixed price. The bill also states that policyholders may not be required to advance payments for repairs.

© 2013 Florida Realtors®