[Fredesch]

Originally Posted by bigh110

Slowly but surely homes all along the Florida coast will become all cash purchases. This will surely drive their prices/market value down. there have been quite a few real estate sales in the Florida keys that have been canceled due to exorbitant insurance costs. The sale falls through and the existing mortgage free home owners are stuck in their homes waiting for a cash buyer. Once a buyer who needs to obtain a mortgage gets their FEMA flood and citizens windstorm quotes for $20,000 plus a year they realize they can't afford the house. The home sale falls through not because the buyer wasn't qualified or didn't have the required 20% down. its because they cant afford $800 to $2400 additional monthly insurance costs in addition to the monthly mortgage and real estate taxes! It leaves the playing fields uneven so to speak as deep pocket developers/rich guys can afford to buy properties for cash and not carry insurance. the middle class working man can't because of the high insurance costs to go along with the mortgage.
In the years to come I expect to see an exodus of mortgage holding homeowners in my keys neighborhood leave as the insurance rates rise. They will sell at a lower price to a cash buyer because they cant afford their mortgage and insurance. The developer will remove the older existing structure/home and rebuild an new structure/home to today's hurricane buliding codes. The new structure/home will have very low insurance costs. The developer than sells the new house for a tidy profit. Because of the low insurance costs a non cash buyer needing a mortgage will now be able to afford the mortgage/taxes/insurance costs.
I also expect lot of new foreclosures for many existing fixed income homeowners with pre 2001 built homes in all coastal areas in Florida with a mortgage. These homeowners barely able to pay their exiting mortgage and insurance costs will not be able to afford the increase in their insurance costs and unable to sell it the bank takes the house.

Flood rate hikes hurting badly | Business | KeysNet

In the Washington DC area, when a developer buys a property, tears down the existing house, and replaces it with a McMasion or two, we call the original house a "tear down". This happens a lot in DC and the inner burbs. When it happens to whole neighborhoods they call it "gentrification" as the homes go from low values to much higher value. Perhaps, this will be the model for coastal Florida, tear down an existing high insurance rate house and replace it with a lower cost insurance rate home. For a buyer paying a higher initial price with a lower insurance rate could come out even in cost, all cash buyers would save money over the long run and the lower insurance new home should retain its value and market edge.

[Dakster]

Originally Posted by Spring Hillian

Flood insurance is a federal government program. The flood maps are federal government.

Citizens has not been a problem with me, maybe because I've had no claims for the 7 years Ive been with them. If you have an insurance agent who is willing to work, you can save a lot of $ on your HOI. I have it down to just under $1,000 a year, replacement value on my stuff, 2 pct hurricane deductible, fire, theft, liability. If you dont want to pay high flood insurance bills, dont buy a house in a flood zone.
If you have and old roof on your house, replace it. if you have old single pane windows, replace them.
if your house was built before the building codes changed have your roof reinforced with hurricane straps. People have to take some responsibility for their property instead of hoping the insurance company is going to take care of it all in the event of a disaster. With improvements you get peace of mind as well as an abode that will hold up better in a hurricane, wind storm, etc.

Yes, Flood is a Federal Program - and they redrew the maps. I am not in Flood zone... But people that bought houses specifically out of a flood zone, now find themselves in one. People that had sub $1000 a year policies now have $3k plus policies. And if the legislature doesn't temper the coast rise, it could go to $10k+ a year. Did you budget for an increase like that?

I have replaced my windows with insulated, double pane, impact windows. I've fixed my house up as much as I can, but in order to get the discounts to go down to $6000 a year like my neighbor with the 2005+ house I'd have to tear it down. Even during the building recession, it was still in the hundreds of thousands to do that.

My answer is simple, now that the market is back up. I will be selling and moving. I know what to buy and where. I am going to also try buying cash or at least getting only a short term mortgage. That way, I can self-insure when I am mortgage free.

If I was under water and unable to afford insurance that has quadrupled in the past 5 years, I would have no choice but to walk away from it. And if more people had to do it, we would crash the market again. There is a potential crash 2.0 coming - another wave of interest only loans are coming due in the next couple of years. Kind of funny when I have to take out a second mortgage to pay my homeowners insurance.

Really, my gripe was more about how they are forcing you to use a contractor and not taking ANY of the responsibility of your house getting fixed correctly. Citizens holds the money - so before the contractor got paid, there should be a requirement that you, the insured, sign off on the work. At least some sort of check and balance.

Out of curiosity, what part of Florida do you live in? And what is your insured value? I know people with every conceivable discount and never had a claim and they are nowhere near your $1000/yr. policy. The rates are set by OIR - so it isn't like you can negotiate with them.

[boxus]

Insurance is the only reason I have not purchased property in Florida. I have been a renter for longer than I have wanted, but I cannot bring myself to purchase a home with the insurance system the way it is (I live in Miami).

[Spring Hillian]

I have a pre-2005 and I got a load of discounts after I hired a guy to certify it was all there. The spacing of the nails on the roof, all that.

I JUST renewed with Citizens. My coverage is for $240k. My hurricane deductible is 2%. Premium is $998 or something like that. I agree you cannot negotiate with them or I would have the $240k coverage lowered. You could rebuild this house brand new with everything in it for $180k. They tell me that you have to have that "overhead" for extra costs that come along. Yeah, OK. My agent (Allstate) got me the rate. Before him I was at $1500 a year for the same coverage.

Your plan on sell/move sounds reasonable. I am in Spring Hill. Hernando County. I would have to go more than 5 miles before I could put my toes in the water and that would be at Hernando Beach.
(There is no beach there, its more like an inlet from the Gulf).

I bought flood ins the first year here but never again. That was 7 years ago.

Originally Posted by Dakster

Yes, Flood is a Federal Program - and they redrew the maps. I am not in Flood zone... But people that bought houses specifically out of a flood zone, now find themselves in one. People that had sub $1000 a year policies now have $3k plus policies. And if the legislature doesn't temper the coast rise, it could go to $10k+ a year. Did you budget for an increase like that?

I have replaced my windows with insulated, double pane, impact windows. I've fixed my house up as much as I can, but in order to get the discounts to go down to $6000 a year like my neighbor with the 2005+ house I'd have to tear it down. Even during the building recession, it was still in the hundreds of thousands to do that.

My answer is simple, now that the market is back up. I will be selling and moving. I know what to buy and where. I am going to also try buying cash or at least getting only a short term mortgage. That way, I can self-insure when I am mortgage free.

If I was under water and unable to afford insurance that has quadrupled in the past 5 years, I would have no choice but to walk away from it. And if more people had to do it, we would crash the market again. There is a potential crash 2.0 coming - another wave of interest only loans are coming due in the next couple of years. Kind of funny when I have to take out a second mortgage to pay my homeowners insurance.

Really, my gripe was more about how they are forcing you to use a contractor and not taking ANY of the responsibility of your house getting fixed correctly. Citizens holds the money - so before the contractor got paid, there should be a requirement that you, the insured, sign off on the work. At least some sort of check and balance.

Out of curiosity, what part of Florida do you live in? And what is your insured value? I know people with every conceivable discount and never had a claim and they are nowhere near your $1000/yr. policy. The rates are set by OIR - so it isn't like you can negotiate with them.

[sware2cod]

Originally Posted by Spring Hillian

Flood insurance is a federal government program. The flood maps are federal government.

Citizens has not been a problem with me, maybe because I've had no claims for the 7 years Ive been with them. If you have an insurance agent who is willing to work, you can save a lot of $ on your HOI. I have it down to just under $1,000 a year, replacement value on my stuff, 2 pct hurricane deductible, fire, theft, liability. If you dont want to pay high flood insurance bills, dont buy a house in a flood zone.
If you have and old roof on your house, replace it. if you have old single pane windows, replace them.
if your house was built before the building codes changed have your roof reinforced with hurricane straps. People have to take some responsibility for their property instead of hoping the insurance company is going to take care of it all in the event of a disaster. With improvements you get peace of mind as well as an abode that will hold up better in a hurricane, wind storm, etc.

How about you do all of the above and your rate is low. Then FEMA changes the flood map and says your elevation is 2 ft too low because your home was just added to a flood zone, when it wasn't in it before. Because this is likely to occur in some areas, since FEMA is changing the flood maps.

[Spring Hillian]

Have the house raised 3 feet.

Originally Posted by sware2cod

How about you do all of the above and your rate is low. Then FEMA changes the flood map and says your elevation is 2 ft too low because your home was just added to a flood zone, when it wasn't in it before. Because this is likely to occur in some areas, since FEMA is changing the flood maps.

[sware2cod]

Originally Posted by Spring Hillian

Have the house raised 3 feet.

Is that possible for the most common type of home in FL..the concrete block ranch built on a concrete slab?

[Spring Hillian]

From one construction company website....
Concrete Slab Floors

Although concrete slab floors seem to be immovable, Wolfe House Movers have lifted and moved many structures including their concrete floors. For a residence or a business; if the building is nice inside and you can’t afford to be out of it long at all, we can lift the slab floor right up with the building. Once lifted, there must be at least a 4′ crawl space built under it and permanent steel beams set underneath it every 5′ for support. The alternate to lifting the slab floor would be to lift the house up off of the slab. This would require the entire lower floor of the house to be emptied (lower cabinets, furniture, appliances, bathroom fixtures, etc.) and the steel lifting beams to be installed through the frame walls at approximately 3′ to 4′ above the floor. Once the house is lifted, the foundation walls can be built up and a new wood floor system built. Then the house will be set back down onto the wood floor system. This will require a significant amount of remodeling (drywalling, painting, etc.) to be done on the lower 4′ of the walls.


So I guess it is possible.

Originally Posted by sware2cod

Is that possible for the most common type of home in FL..the concrete block ranch built on a concrete slab?

[bigh110]

Its possible to raise a house yes when money is not a problem, cost effective NO!

[Spring Hillian]

If you have to pay $10k a year for flood insurance it would probably be very cost effective.

Originally Posted by bigh110

Its possible to raise a house yes when money is not a problem, cost effective NO!