Question for those familiar with Pinellas Park FL: Is this currently a good location to invest (rent/flip) or are there still flooding problems that can kill your potential? I was driving for dollars the other day and saw an unoccupied property (near Wagon Wheel) that I wanted to check out. It had a stop work order posted on the door. I found someone at the end of the street who I spoke with and he told me the owners had to stop work because they were told they had to raise the house due to the flood zone. It is in the flood zone area (according to Trulia), but what I thought was really strange was that the guy I spoke with was closer to the water and in a much newer house that was not raised.
There has been a lot of drainage work done in the last couple of decades around there (and all over St. Petersburg) but can anyone who has experience in this please chime in?
Being near the water (depending where / what water source) does not mean your are in a sfha. It sounds like they went over their substantial improvement funds, but I am not sure what ordinances pp has for the community rating system, sometimes they are 5 year limit 50% of recorded value before the home must be brought into compliance (raised), but different cities use different standards. Go to FEMAs flood maps online, type in the property address your looking at and see if it is in the grey areas. If the parcel is out you would be fine for now, but the flood maps change over time. Pinellas Park should have a CFM, or CRS coordinator you can talk to for more information. This may have raised more questions than it answered, but feel free to ask clarifying questions.
I really do not think it is in the flood plain. No way. It is in a much higher area than the barrier islands. Maybe did not have a permit?
Thoughts @Jeff Copeland ??
My friend and client @Joe Gutmann hit the nail on the head above. I talk a lot in the forums about avoiding flood zones because I view flood insurance as an unnecessary expense for most buy & hold investors. But, as Joe alluded to, there can be substantial hoops to jump through on a flip as well.
What Joe referred to above is the Community Rating System (which basically determines a municipality's rates and discounts for flood insurance), usually managed by the municipality's Certified Floodplain Manager.
One of the common restrictions on properties in flood plains is the "50% Rule" - meaning you need special approval and/or must bring the property fully up to existing codes if your renovations exceed 50% of the assessed value over a 5-year span.
That being said, Pinellas Park can be a great place to invest. Just avoid the flood zones. Being further inland than many of our coastal communities, many people (like @Judy Tagert above mentioned) don't realize that huge swaths of Pinellas Park are in fact in Special Flood Hazard Areas:
The official source of these is the FEMA flood map service center, where you can pull up individual flood panels. But they aren't very user friendly. For a quick check, I really like Trulia's interactive flood zone maps.
Thanks @Jeff Copeland and @Joe Gutmann for the detailed explanations. It sounds like whenever you might have to consider flood insurance, that the warning flag goes up. I didn't know about the 50% rule but maybe that is affecting the property. The thing that makes me wonder is a house at the end of 79th St. N. that is closer to the water, looks much newer, but is not raised. Could the owner have contested the flood zone designation is what FEMA says the final word? Looking at that map though, PP looks like a dicey place to operate in.
@Mike Snyder - A far more likely scenario is the house simply pre-dates the existing building code that requires it to be raised or have other flood mitigations in place. Hence the 50% rule - if they ever decide to tear it down (more than 50%) and rebuild, then they have to bring it up to current code.
FEMA's word is pretty close to final. After all, it's simply based on elevation, as measured by LIDAR, so it's tough to argue with.
But don't write off Pinellas Park completely. There are plenty of non-flood zone areas, and I've done a couple of nice flips there:
Maybe the newer lower home was flooded and rebuilt so looks newer...or is just outside the food zone, whether it looks lower or not. I have a house in a flood zone and we just got a letter telling us flood insurance will be raised to reflect the actual risk of flooding. Current premium $2600 year in 100 year flood plain. That is like 40k financed over 30 @%4.5. Do your homework.
@Mike Snyder - (A moderator named Venison removed my earlier post for some reason, apparently we aren't allowed to share photo albums of homes we've flipped for fear you might think that I might hope that you might like the photos, which in turn might or might not suggest that you may or may not have some interest in doing business with me and/or other members of this forum...for what it's worth, I was totally just sharing pics, it was not at attempt to solicit business!).
A far more likely scenario is the house simply pre-dates the existing building code that requires it to be raised or have other flood mitigations in place. Hence the 50% rule - if they ever decide to tear it down (more than 50%) and rebuild, then they have to bring it up to current code.
FEMA's word is pretty close to final. After all, it's simply based on elevation, as measured by LIDAR (you can look this up yourself, I will not link to the National Oceanic and Atmospheric Administration's web page, lest Venison think I am promoting NOAA on the forums), so it's tough to argue with.
But don't write off Pinellas Park completely. There are plenty of non-flood zone areas, and some individuals, who may or may not be me, have, on occasion and without soliciting interest in photographs of said flips and/or suggesting that any of us may benefit from knowledge of each other's existence, or non-existence as the case may be (I'm not promoting either one), been successful with flipping and/or buying and holding properties in and around Pinellas Park....Just avoid the flood zones.
@Jeff Copeland I may or may not be offended and/or may or may not be more informed by your posts... ;)
Great info. Bottom line sounds like you still just have to evaluate deal-by-deal. That map sure gives a better understanding of what you may run into though. I drove by there again today and the commercial section just south and west of Wagon Wheel looks like they are squarely in the high-risk flood zone, but are like 10 - 12 feet higher. Nice.
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