Most times you can get a sense from the listing price - in most of the short sales we've done in the Keansburg/Highlands area, the BPO value gets adjusted down to reflect the cost of doing the work...so the buyer would not be overspending for the property in a flood zone. However, it is not uncommon for the seller's lender to first try to list the home at the pre-Sandy "business as usual" price and reflect a crazy price that will not get any buyers.
Once that happens, it becomes apparent that the lender needs to either fix the problem and try to sell higher (unlikely) or decrease the BPO value to reflect the costs to remediate the situation in an AS IS sale where is. Always ask for full disclosure on the height requirement issues and work done before submitting an offer! Tom Hinz www.shortsaletosell.com