My specialty lately has been highly distressed foundation issue houses..
I've found a pretty high end house in CA that has been flooded and I can probably pick it up for about $250K with an ARV value of about $700K
My plan would to be to raise the house with a cripple wall about 4' and I should be able to get it done for about 100K. This should give me at least $300K on the upside.
This flood area isn't that large, it's from a borderline creek that overran and flooded 3 or 4 other neighboring properties, perhaps I could get together with the neighbors and build a levy, I do enjoy running bulldozers..
My Issue is the whole flood zone buying / selling which I do not have any experience with.
Any experienced flooded / flood zone investors here?
Would really appreciate the feedback..
@Mike Jones This subject interests me, since the area I invest in has flood zones all over. Some of the best deals are sitting in flood zones, but no one wants to pay for flood insurance. The average cost (from what ive seen) of insurance around here is around $3000, with an increase of about 12% a year projected with no end in sight.
The only way around that is to own the property outright. But again the problem is when you go to sell it. I have seen people building on columns to avoid it, I wonder if you can lift an existing building? Id expect these homes in flood zones to drop in price significantly over the next few years.
Great point Brian,
I'm checking with my Insurance Gal to get a quote and info, I'll post it up later so you know..
Hey @Mike Jones - did you end flipping this house in a flood zone? I am also looking at one and searched the forums. Any major hurdles you came across? Were you able to sell it even though it was in a flood zone?