Before you buy an older home near the beach in Florida, be aware of FEMA’s 50% rule.
This rule restricts remodeling a home in the flood plane to 50% of its current value (that’s the value of the house, exclusive of land).
If a home is worth $200,000 then up to $100,000 worth of work can be done. Now, for a lot of homes, that’s enough remodeling.
But for those homeowners who want more extensive work done, contractors have figured a couple of ways to deal with the restrictions.
1. Remodel in stages. Once the initial remodeling phase is complete, and the value of the home has increased, contractors begin a second phase.
2. Build at a higher elevation. A new wing can be built to code, that is, at the required elevation. The new wing would be exempted from the 50% restriction.
3. Bulldoze the home. Sad, but often done in areas where the land value is high and the home is small and old.
Be sure and check with your local real estate attorney, just in case this is not the official position held by FEMA.
Vito Bauer-Principal Realtor “Trusted Source for Homes in Southwest Florida”
Cell 239.777.7080, email: Vito.Bauer@BauerInternationalGroup.com
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