The Desjardins Group, a Quebec-based lender, is no longer issuing mortgages in high-risk flood areas, multiple media outlets reported this week. That is stoking concerns that similar measures could be taken in other places, including the U.S.
According to the Insurance Bureau of Canada, roughly 1.5 million homes, representing about 10% of the nation’s housing market, are already unable to obtain flood insurance as many insurers across Canada avoid flood zones.
In addition, Canada doesn’t have a national flood insurance program. In the U.S., Congress still has to vote on the extension of the National Flood Insurance Program (NFIP), which is set to expire on March 22. Since September 2017, NFIP has been reauthorized without dedicated legislation 28 times.
Canadian homes in recently flooded areas posted lower values. The sales prices of these homes dropped by 8%…
