New flood insurance law may hinder Hamptons sales

June 05, 2012 03:00PM

Homeowners in the Hamptons and other vacation-heavy enclaves will no longer receive subsidies for flood insurance. The New York Post reported that the new law could negatively impact an already slow real estate sales market in the area, as buyers have another cost to take into account.

The provision is part of a larger flood insurance program overhaul that’s floating around the U.S. House of Representatives, who the Wall Street Journal reported just extended a deadline for changes to the system. But an alteration proposed by Oklahoma Sen. Tom Coburn has already been made permanent.

Per Coburn, owners of second homes, third homes and vacation homes will no longer recieve subsidies and will instead pay 25 percent more over the next four years for insurance.

“If you can afford to own property that’s in those areas, then you can afford the insurance,” Coburn said.

The Post said the average US homeowner pays $600 per year, but in the Hamptons flood insurance costs range up to $2,200. [Post] and [WSJ]