Flood zone buy and hold

[Shawn Mcenteer]

What are the thoughts on purchasing buy and hold rental in flood zone? Do you have a tough time renting? I know the rates will likely be high for flood insurance from Hurricane Sandy but this particular spot does not flood frequently.

Any feed back on addtional thoughts to consider when analyzing deal is greatl apprecatied.

[Don Konipol]

@Shawn Mcenteer , you must determine if the property is in the flood plain or the flood way. In the flood plain you can build, you just have a small chance of your property flooding in any given year - flood insurance may be available. In the flood way you have a much bigger problem - your property is in an area in which water is directed to in event of heavy rain. In this case many municipalities won't allow rebuilding if the structure is rendered 50% or more damaged by water. Other municipalities will allow rebuilding if the structure is built at a high level. The buildup of ground won't work in this case as this would not allow the water to pass through the property - remember the property is in the flood way. So you would have to build the structure 6 feet or higher above ground, and get approval for the foundation structure which would inhibit the flow of water to some degree.