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Old 06-12-2014, 10:02 AM
 
74 posts, read 56,290 times
Reputation: 142

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Hello, My wife and I are seriously considering buying a house in an AE flood zone in the Dunedin area. It's 3 or 4 blocks from the water(bay), needs little work and is convenient to town etc. It's a pre-firm house(1958). The elevation is 3.25 ft below the BFE of 11ft..Got an elevation certificate.. I got a quote of $1200.00 a year for flood insurance...I don't have to get the coverage because I'm not getting a mortgage... The question I have is? What's is going on with the flood insurance? I'm getting different answers from different people. Someone said that if I buy before September, I'm locked in with the low rate. An insurance guy told me nobody really knows what they are going to do...It's going to be my primary residence but I don't see why that should matter...What I do with my place is my business right? I don't want to be stuck with a house I can't sell... If I ever want to sell..What's the worst case scenario? The rates go up to 15k a year and at that point I have to lift it up 4 or 5 ft (40 to 60k) to get it sold or just get a good rate?..It's a 1100 sq ft ranch... It's not in a repetitive flood area...I checked with the town etc, there has never been any flood damage as far as anyone knows... I don't have to buy it. I can walk away. But, we like it a lot and its within our budget. Thanks
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Old 06-12-2014, 10:51 AM
 
4,542 posts, read 3,808,993 times
Reputation: 3481
Rates on pre-firm primary residences are much lower than pre-firm secondary homes. Rates are rising 10-1-2014 for all homes. If you are not getting a mortgage a 30 day waiting period so you have to buy the policy before end of August to lock in lower rates.

Since Hurricane season Starts June 1st anyhow I would buy it now.
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Old 06-12-2014, 10:54 AM
 
22,946 posts, read 33,920,125 times
Reputation: 11569
The truth is that nobody will know what will happen down the road. Cash buyers can choose to take flood ins. or not while home buyers who need a mortgage are obligated to get it.

FEMA may rezone certain areas since some home owners are fighting the rezoning that is now the cause of them needed flood ins. while they never had any flooding.

If you talk to home owners who live on the Gulf but are build higher up then you often hear they live there for decades and never ever did they have any flooding...but that is something that a new owner needs to decide on their own.

We just sold a home over $ 700K to a cash buyer who got the first quote for flood ins. for $ 59K with deduction it ended up being $ 49K and later with ins. comp. from the seller the quote came back for $ 4000 which is a huge difference but this cash buyer stated at the time he was not going to take it since the house is high up and if something happens he is capable to take the hit.

Some areas are real flood areas and in Pasco County the County is putting in a new drainage system on many streets to avoid flooding. Our office is in a flood zone and we were evacuated with the last storm while we never saw a puddle in our parking lot or the street in front of our office. But the intersections in the area would flood which could have caused us to be trapped and not able to get home and that was the reason that we had to leave our office.

In the end nothing happened and the last month's the County is working really hard to get everything ready so these intersection will be able to get the water out and no flooding will occur. We don't know if that means that in the future the area will no longer be a flood zone area and they may want to wait to see what happens during future storms.

Legislation keeps changing so nobody will be able to predict if you will be stuck or not but if you would get stuck that means hundreds of thousands other home owners will be stuck and they all will speak up to get something changed.

Keep in mind that the person who put her name on the bill "Waters" later supported changes to her own bill, so it seems they acknowledged it was not as good as they at first thought it would be.

In the end it will be your choice to decide to buy or not....I wish there was a more secure answer but we all know that laws keep changing and some for the better and some not.
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Old 06-12-2014, 11:04 AM
 
Location: USA's #1 MSA 4 Years Running
8,569 posts, read 7,309,510 times
Reputation: 4885
Quote:
Originally Posted by tgtguy111 View Post
Hello, My wife and I are seriously considering buying a house in an AE flood zone in the Dunedin area. It's 3 or 4 blocks from the water(bay), needs little work and is convenient to town etc. It's a pre-firm house(1958). The elevation is 3.25 ft below the BFE of 11ft..Got an elevation certificate.. I got a quote of $1200.00 a year for flood insurance...I don't have to get the coverage because I'm not getting a mortgage... The question I have is? What's is going on with the flood insurance? I'm getting different answers from different people. Someone said that if I buy before September, I'm locked in with the low rate. An insurance guy told me nobody really knows what they are going to do...It's going to be my primary residence but I don't see why that should matter...What I do with my place is my business right? I don't want to be stuck with a house I can't sell... If I ever want to sell..What's the worst case scenario? The rates go up to 15k a year and at that point I have to lift it up 4 or 5 ft (40 to 60k) to get it sold or just get a good rate?..It's a 1100 sq ft ranch... It's not in a repetitive flood area...I checked with the town etc, there has never been any flood damage as far as anyone knows... I don't have to buy it. I can walk away. But, we like it a lot and its within our budget. Thanks
No one knows what will happen with the flood insurance, no matter what they tell you. Buy in a flood zone, accept the associated risks.
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Old 06-12-2014, 02:25 PM
 
Location: Hmmm, let me think.
3,312 posts, read 7,101,029 times
Reputation: 2819
I think it is clear that flood insurance rates.... like all insurance rates will continue to rise. There has been a lot of discussion about the government no longer subsidizing flood insurance. There has been talk that flood insurance could cost a homeowner $15K a year on a modest house.

Homes that are in a flood zone are harder to sale. Educated buyers understand that their is an insurance cost associated with the home that will never go away nor be applied to the principal of the loan.
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Old 06-12-2014, 05:53 PM
 
2,598 posts, read 3,821,311 times
Reputation: 2103
Pre-firm house that is below Base Flood Elevation is going to cost quite a bit when it is said and done. You have the option of self insuring. So, go ahead. What is the value of the house??
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Old 06-12-2014, 07:24 PM
 
Location: USA's #1 MSA 4 Years Running
8,569 posts, read 7,309,510 times
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Quote:
Originally Posted by Pragmaticus View Post
Pre-firm house that is below Base Flood Elevation is going to cost quite a bit when it is said and done.
That is an unknown.
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Old 06-12-2014, 08:28 PM
 
2,598 posts, read 3,821,311 times
Reputation: 2103
Quote:
Originally Posted by PriusH8r View Post
That is an unknown.
Unknown like what? A house under BFE pre-firm cost more to insure than other houses. That's known unknown. There are known unknowns and there are unknown unknowns .
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Old 06-13-2014, 12:10 AM
 
Location: USA's #1 MSA 4 Years Running
8,569 posts, read 7,309,510 times
Reputation: 4885
Quote:
Originally Posted by Pragmaticus View Post
Unknown like what? A house under BFE pre-firm cost more to insure than other houses. That's known unknown. There are known unknowns and there are unknown unknowns .
I just have a feeling politics will be involved. I really don't know, because it is unknown if that will be unknown.
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Old 06-13-2014, 02:10 AM
 
Location: Florida
3,283 posts, read 1,587,502 times
Reputation: 5610
Flood Insurance is run by the same government that gave us Obamacare. If it works they will change it.
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