Investing in a High-Risk Flood Zone (AE) – Worth It or Hard Pass?

[Mario Niccolini]

Hey BiggerPockets community!

I’m analyzing a potential deal in Florida, but there’s a catch—it’s in an AE (High-Risk) flood zone. Hurricane Milton recently caused widespread flooding, yet this house remained unaffected. Still, I’m weighing the risks.

🔹 How much does AE zoning hurt resale value?
🔹 Does it make renting harder?
🔹 Have you reduced flood insurance costs (Elevation Cert, mitigation, etc.)?
🔹 Would you still do the deal?

Is this a hidden opportunity or a deal-breaker? Would you buy it? Appreciate any insights! 🚀

[Obed Calixte]

Most desirable areas in Tampa Bay are in AE or higher risk flood zones and generally sell for a premium for a comparable home placed elsewhere - all else equal . 

Areas such as Shore Acres flood with frequency and maintain high demand.  The latest storms have brought about heightened attention and buyers are more astute than years past with purchasing flood risk homes. How that will play out for long term values is unknown - however human nature has shown proximity to water is desirable. 

You didn't provide any numbers so can't answer if it's a good deal. With that said, it all comes down to your goals, your risk appetite and sufficient reserves. If the deal fits your parameters then go for it, otherwise skip it and find another.