Disclosure matters more than the risk itself. A seller who is upfront about past water issues and any remediation tends to negotiate from a stronger position than one whose buyer finds out during a home inspection, typically $400 to $600, since a surprise late in a deal invites a harder renegotiation than an early, honest conversation.
Insurability is the other lever. If a buyer's lender requires flood coverage and a Rosewood property struggles to get an affordable policy, that cost gets factored into the offer whether or not it shows up anywhere in the listing description.
The mechanism is buyer confidence, not a published penalty. Get your hand-reviewed valuation from Joel Dyck.