Suwannee County Home Insurance..... (Lake City, Live Oak: wood floors, house, purchase)

[Matchell]

I live in NC and just purchased a home in Suwannee County as a second residence/investment as I have relatives there. Was a blown away with the cost of property tax rate and home insurance. Knowing there is nothing I can do about the tax rate I am in hopes of finding better insurance options.

The home I purchased is an older one (built in 1938) 1,300 sq feet and located on a corner lot with a fire hydrant on the lot plus within 2 miles of a fire station. I bought it as a short sell for $60K and know it was a steal; however, the tax value reflected my purchase price for 2012. Here is my question......... I could not find an insurance company that would insure it for under $230K value with a cost of $1,650 annually. Is this normal?

I sure would like to insure it for around $130K -150K as that is closer to the rebuild cost but not the $230K. Any insurance wizards here that can explain why the $230K and if there is a company that will insure it at a more realistic rebuild cost?

Thanks,

[ssclulow]

It will be very difficult to find less expensive insurance on a house that old, in particular one whiich is not lived in as a primary home. Insurers generally shy away from homes that stay empty a good part of the year. Problems can occur when no one is there which compound fast if not addressed quickly. Many policies actually have clauses voiding the insurance if a house is unoccupied continuously for more than a month. In any case, if rebuilt or repaired, the home would need to be brought up to current Florida and county building codes (not just replaced with the same materials currently in the home.) You would probably be shocked at the cost of windows, trusses and roof materials meeting current wind codes as well as electrical and plumbing materials.

[Matchell]

Even though it is a secondary residence for me it does have family members living there 100%. I understand about bringing everything up to code and I failed to include in 1970 the electrical and plumbing were updated when a room was added. As I bought it as such a good price, I used some extra cash to replace all the windows, added insulation, ripped out the carpet and buffed out the wood floors (and other cosmetic things). The roof is being replaced in the spring. After the roof is finished I will have a total of $79,500 invested. That's why I suggested a replaced value of about $115 per sq ft to rebuild which is about $30 over the average suggest rebuilt cost in Florida.

I am still baffled why an insurance company wants to insure it at $230K when I 'm thinking if something happened to the structure and I had to rebuild they would not give me the $230K to rebuilt.

[DanBev]

What you paid will have no bearing on taxes,assessed value of land and assessed value of home combined will determine taxes.You cannot claim homestesd exemption worth$25,000.
Lived in Suwannee County 20 years,glad to be in Columbia County,never ever liked Suwannee County politics.Not much for your taxes.

[Matchell]

Understand you like Columbia better than Suwannee --Columbia is certainly more progressive! My tax value dropped $10K last month, in my case, when the records were updated to reflect my purchase and ownership. The new value matched my purchase price plus $100.

I have many friends and relatives in Lake City who love it there. I grew up in Live Oak and just wanted a place to stay, in my retirement, when I would come down for extended visits.

Back to the insurance. Seems like I am beating a dead horse, so to speak, as the cost is the cost and that's it.

Looking for investment property now..... will probably look in Columbia County as it sounds like taxes and insurance are lower there.

[Robyn55]

Originally Posted by Matchell

Even though it is a secondary residence for me it does have family members living there 100%. I understand about bringing everything up to code and I failed to include in 1970 the electrical and plumbing were updated when a room was added. As I bought it as such a good price, I used some extra cash to replace all the windows, added insulation, ripped out the carpet and buffed out the wood floors (and other cosmetic things). The roof is being replaced in the spring. After the roof is finished I will have a total of $79,500 invested. That's why I suggested a replaced value of about $115 per sq ft to rebuild which is about $30 over the average suggest rebuilt cost in Florida.

I am still baffled why an insurance company wants to insure it at $230K when I 'm thinking if something happened to the structure and I had to rebuild they would not give me the $230K to rebuilt.

Florida has a valued policy law. If your house is insured for X - and it is destroyed - the insurance company owes you X (no matter what the house was worth).

Also - I believe that under the state building code (not local building codes) - that if more than half the house is damaged - you must rebuild the whole house to current code (no option to repair).

I think your rebuild costs are unrealistic. Especially under the current codes. I've been told that the cost to replace a roof has doubled or even tripled under the new code. Take a modest rebuild cost of $125/sf - that's $162,500 ($150/sf = $195k). And - if you're in a flood prone area - and your house is low - you may need a ton of fill to rebuild to current elevation requirements. Etc. The $230k sounds high - but not outrageously so IMO. Robyn