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Updated almost 6 years ago, 12/18/2018
Summerville Neighborhoods Near the Ashley River
Does anyone have any intel about buying fixer-uppers in older neighborhoods where you can find some ugly houses but some good ones too - like maybe Ashborough or Archdale in the Dorchester Rd. part of Summerville - but which are close to the Ashley? I know some of those areas flood. How should flooding (past, future) figure into your buy-rehab-sell plan?
Keyword: Charleston
@Jason Merchey Funny, I was just showing these areas to a client on Tuesday. We ratified a contract on one in Kings Grant today. I like the area. Dorchester 2 school district which helps with values and a lot of it is in a non-flood zone. Of course every house needs to be individually assessed as to flood potential. If it's a flip, the long term flood perspective is not so critical. For a buy and hold, all of Charleston should be questioned imo.
I know there was some serious flooding in Ashborough in 2015. I had just sold a house in there and while my clients were on a rise (thankfully!) and didn't flood, they told me stories of rescuing deer from trees and seeing a mini-cooper floating down a street. You will definitely need to look carefully...
Need to be concerned more about the feeder streams to the Ashley in Summerville such as the Sawbranch where neigborhoods back up to it. Ashborough East is one and also Arbor Oaks. Most of Ashborough that backs up to Ashley River is high ground except the part down by Lake Ashborough.
We have rehabbed/flipped 2 in Asborough and 1 in Kings Grant (or the other way around...can't remember). Our properties were on high ground.
We always check FEMA maps. Properties in flood zones sell for lower prices, because most people buy based on monthly payment as much as or more than purchase price. Flood insurance is a monthly expense that the end-buyer (homeowner) must factor in when they purchase. We have flipped a few houses in flood zones, but always reduce our purchase price to reflect the reduced sale price on the retail side. @John Semanchuk nailed it. Every property must be individually evaluated.
In 2015 We purchased an SFR in West Ashley where flood insurance is required. We laugh about it now because it was such a great learning experience for us. It was our first rental acquisition and we hired a horrific Realtor who ended up leaving us mid transaction. Poof, gone. We learned pretty far into the deal that flood insurance of $2500/yr was required. It was a FSBO so no other agent was running the transaction, and not knowing any better, we went through with the deal because back then we banked on appreciation to build our wealth. In the last 3 years we have cash flowed maybe $2,000 total! I will say 2015 to present was a great time to make a mistake like this as we have seen appreciation which thankfully has acted as cover up to our blemish (if we are able to sell it in the spring without a big dip in the market).
All that being said, a flood policy can eat all gains.
Mike Bargetto
Flood zones aren't always a good indicator of whether a property will flood. All you can count on from the flood zone designation is whether a lender will require you to have flood insurance. It's also important to look at the preliminary FEMA maps which show what flood zone changes will be coming to a property when those maps are implemented. FEMA's been pushing back the implementation of those maps for some time now but there's still the expectation that they will become the official maps sometime in 2019.
@Mike Bargetto I suggest you talk to Lisa Sharrard at Choice Flood in Columbia. I've not come across anyone who understands FEMA's flood rules better than her. Let her know I sent you:
Lisa Sharrard, CFM ANFI, CPM
Choice Flood Insurance LLC
BP won't let me post her phone #...
I might add that this morning would be a great time to drive by any properties/neighborhoods you're considering! :-D
@John Semanchuk I was on the phone with my property manager discussing an off market deal while you wrote that! It is raining cats and dogs out there. Thank you for Lisa's name also. I will google her contact info now.
Holy cow! Or should I say, "Deer!"
J
Originally posted by @John Semanchuk:
@Jason Merchey Funny, I was just showing these areas to a client on Tuesday. We ratified a contract on one in Kings Grant today. I like the area. Dorchester 2 school district which helps with values and a lot of it is in a non-flood zone. Of course every house needs to be individually assessed as to flood potential. If it's a flip, the long term flood perspective is not so critical. For a buy and hold, all of Charleston should be questioned imo.
I know there was some serious flooding in Ashborough in 2015. I had just sold a house in there and while my clients were on a rise (thankfully!) and didn't flood, they told me stories of rescuing deer from trees and seeing a mini-cooper floating down a street. You will definitely need to look carefully...
Yikes. Ok thanks MB
Originally posted by @Mike Bargetto:
All that being said, a flood policy can eat all gains.
FYI @Matthew Hipp
Originally posted by @John Semanchuk:
Flood zones aren't always a good indicator of whether a property will flood. All you can count on from the flood zone designation is whether a lender will require you to have flood insurance. It's also important to look at the preliminary FEMA maps which show what flood zone changes will be coming to a property when those maps are implemented. FEMA's been pushing back the implementation of those maps for some time now but there's still the expectation that they will become the official maps sometime in 2019.
@Mike Bargetto I suggest you talk to Lisa Sharrard at Choice Flood in Columbia. I've not come across anyone who understands FEMA's flood rules better than her. Let her know I sent you:
Lisa Sharrard, CFM ANFI, CPM
Choice Flood Insurance LLC
BP won't let me post her phone #...
@Jason Merchey Ha! I am not but you would find plenty of slugs where I live :)
@Mike Bargetto That seems really high for flood insurance. I'm in an AE zone in WA (personal residence) and pay around $1,700/yr on a $350K+ home.
It sounds like you haven't flooded since you bought the house, is that right? If so, you are super lucky! because the past 3 years have been pretty bad in certain areas of West Ashley.
If you haven't flooded you can raise your deductibles or eliminate contents coverage entirely... someone can correct me if I'm wrong, but I don't think contents coverage is a requirement by lenders. Just from my own experience... I flooded in Irma and I didn't meet the contents deductible (which was $5,000)... And, if the home doesnt have ductwork in the crawlspace (unfortunately mine does) theres less of a need to have a lower building deductible in my opinion... also think it's smart idea to get HVAC raised up.
Like John said, flood zones definitely aren't an indicator of whether a property will flood. On my street (AE zone), 2-3 houses flood regularly during storms while others have not been impacted whatsoever, yet all are required to buy flood insurance.
@Steven N. I really appreciate the feedback. Since we purchased it I have had no issue-my unit seems to be on high ground. I may go get another quote but I heard that since it is a federal mandate for these flood areas that the price is the price is the price..Have you found this to be true? Essentially, it is not a free market which makes sense being a federal mandate. Thanks again.
for NFIP I think that is true but that doesnt mean you can't make your deductibles higher (which lowers premium) and reduce or cancel contents coverage (am I not 100% sure about cancelling so I would ask someone)