What condition commonly applies to properties in flood zones?

Properties located in flood zones typically require mandatory flood insurance if the purchase is financed through a lender. This is due to the increased risk of flood damage in these areas, which can significantly affect the property's safety and structural integrity. Lenders want to mitigate their risk, so they mandate that the borrower obtain flood insurance to protect both the property and the lender's investment.

This requirement is enforced by the National Flood Insurance Program (NFIP), which aims to reduce the financial impact of flooding on property owners and encourage floodplain management. Options relating to higher taxes, reduced property value, or increased closing costs are not universally applicable conditions associated with properties in flood zones. While these factors can be influenced by various circumstances surrounding a property, they do not represent a common condition like the requirement for flood insurance does.