Want to flag that new flood risk rules starting on January 1.  This only applies to our members using HUD-financed programs, specifically FHA and HUD-backed financing, so it’s not an issue for every builder.  We want to make one final push to get the word out on what this means and does not mean.   If you could forward this to your local EOs, especially those who were affected by the hurricanes, as this may affect rebuilding efforts, that would be helpful to spreading the word.

HUD’s new Federal Flood Risk Management Standard (FFRMS) rule will require compliance beginning on January 1, 2025. Our regulatory team has put together a blog post and a separate website with all the relevant info:

https://www.nahb.org/blog/2024/11/ffrms-reminder

More Info: NAHB’s FFRMS Landing Page

Why this is important: Multi-family and single-family home builders using FHA insurance or HUD financial assistance programs will be covered under this new FFRMS rule.

For multi-family builders, here are 5 key facts to know:

1. The rule applies to multifamily new construction or substantial improvement projects.

2. The new Federal Flood Risk Management Standard (FFRMS) expands the floodplain vertically through elevation requirements and horizontally beyond the boundaries of the 100- year floodplain.

3. Elevation requirements in the FFRMS will be determined by a 3-tiered process:

• Climate Informed Science (CISA) maps, which use predictive models to forecast future flood elevations; however, builders aren't required to use CISA until HUD approves CISA maps.
• FEMA's 500-year floodplain where CISA maps aren't available; or
• Elevation 2 feet above the base flood elevation (BFE) when the 500-year floodplain is not mapped.

4. The rule also includes new tenant notification requirements.

5. HUD assured borrowers that FHA multifamily mortgage insurance applications submitted by October 1, 2024 could be processed under the floodplain regulations that preceded HUD's FFRMS requirements.

For single-family builders, here are 3 key facts to know:

1. Compliance with new elevation requirements will be required for single-family new construction where building permit applications are submitted on or after Jan. 1, 2025.

2. HUD will require single-family homes located in a 100-year floodplain to be elevated 2 feet above base flood elevation to qualify for FHA mortgage insurance.

3. The final rule also includes expanded notification requirements for owners, buyers and developers.

As we move into the next Congress, and with the incoming Administration, NAHB will work to unwind this rule. We need flood management policies and programs that are practical, predictable, adaptable to local conditions and protective of lives and properties.