Flood Damaged Properties

[Chris Carson]

In the aftermath of Hurricane Irma my partner and I have come across a bunch of flood damaged SFR and MFR properties at huge discounts. We buy and hold but are in a position to change course if it would make financial sense to do so. Many of the areas that flooded are very desirable however they have gotten really high water from storms for a few years running. That said, Irma was far and away the worst flooding our area has seen in generations. Lots of people are looking to get out which tells me that this might be the right time to push hard. Any of you cagey veterans made similar moves before?

[John Mocker]

Chris,

The National Flood Insurance program is deeply in debt and I'm sure this year is not going to help their results.  Congress was already looking at changes to the program, one of which was to limit payouts on properties that have multiple losses.  Nothing definite yet but if they do anything to limit the coverage that will impact your resale.  I would recommend doing some research on what was being proposed.  

In FL you also face issues on windstorm coverage.  The state has a pool which provides coverage for coastal  properties.   I would see how that was impacted by the hurricane.  If they had bad losses you may see rate increases there.

Lastly, if you are going to renovate the houses, I would look at the cost to raise them.  That could lower your flood costs significantly.

Good luck.