Natural Hazard Disclosures

Natural Hazard Disclosures (NHDs) are required for virtually every real estate transaction (and if they’re not required for yours, you should get one anyway). An NHD report can be generated in varying levels of detail and as the name implies, it lets you know which natural hazards may cause problems for your property—some of which you may never have considered. For example, is your property within 2000 feet of a military ordinance supply depot? Is it adjacent to a toxic Superfund cleanup site? Is it in an Alquist Priolo Special Study Zone? Is it in a Tsunami Inundation Zone?

In addition to these rather rare situations, NHDs cover the types of natural hazards you would imagine: flood zones, wildfire zones, seismic zones and more. The report begins with an aerial photo of the property and some basic identification details. Then it shows the property on maps with the zones outlined, so you can see how close your property is to a flood plain or an earthquake fault.

Each hazard has varying levels of risk. For flooding, there are 500-year flood plains, 100-year flood plains, and 50-year flood plains. Clearly, the less frequent the better. An NHD will also review how disastrous it would be for a given property if a dam broke: would you be in the water’s direct path or on a hill overlooking Ukiah’s new waterway?

For wildfires, you typically don’t want to be in the Very High Fire Hazard Severity Zones. Placement within these zones is based on criteria that include things such as number of structures within a given area, weather, topography, and fuels. Buyers are subject to fines for failing to provide for proper brush clearance and other preventive measures in these zones. The next fire risk level is a wild land area “that may contain substantial forest fire risks.”

For seismic risk, several issues arise. First, the report determines whether your property is on a fault line and if so, is it a substantial one? Risk-averse buyers tend to shy away from buying properties on fault lines. Second, the report identifies seismic hazard zones and areas of potential danger to the public from ground failure caused by earthquake ground shaking, dangers like landslides and liquefaction (liquefaction refers to the earth behaving similar to liquid with prolonged shaking, allowing all or a portion of structures to sink below grade). Houses built on landfill can suffer from liquefaction problems during an earthquake. In fact, you may have seen extreme cases in the Bay Area recently with whole houses disappearing into sinkholes.

If you’re using an NHD to learn about property that already has improvements (the house is already built), you can take precautions based on the findings. For example, in a high fire zone, you can trim trees away from the house and up eight feet off the ground, as well as clearing brush 100 feet from any structures (especially your propane tank). If you’re using an NHD to determine where and how to build, it can be very useful. Knowing how to mitigate potential natural hazards can allow you to significantly reduce your financial exposure and/or risk of bodily injury. If you know there’s a higher-than-average chance of damage from an earthquake, beef up the foundation (and don’t build on the fault line). If you’re in a flood zone, build up the land to raise your house above the flood plain or build up the foundation wall to protect against flooding. NHDs are also helpful before you sign a purchase agreement in case you cannot build the way you want to. If you are in an airport influence area, a high-rise apartment building would likely be denied, both because of its height and because of the density of people.

If you have questions about real estate or property management, please contact me at rselzer@selzerrealty.com or visit www.realtyworldselzer.com. If I use your suggestion in a column, I’ll send you a $5.00 gift card to Schat’s Bakery. If you’d like to read previous articles, visit my blog at www.richardselzer.com. Dick Selzer is a real estate broker who has been in the business for more than 40 years.