Flood insurance estimates in New Orleans?

Question

Does anyone have any experience estimating flood insurance premiums? I found the FEMA flood map and determined that the area I am looking at (Gentilly) would require flood insurance.

Have you estimated flood insurance before?

Should that be a deal breaker? It seems like that will almost always be a risk in a place like NOLA.

Thanks!

Mike Wood · Answer

@John Maxi You should assume any property in Orleans parish will require flood insurance if you are financing it.   There are new FEMA flood maps coming that might change that, but only time will tell if the lenders will allow property owners to drop there flood insurance just because FEMA now says your in a flood zone X - not required to have flood insurance (FYI, based on the new FEMA flood maps, I have have two properties that will now be Flood zone X, but both properties got 8ft in the street for Katrina and both heavily flooded).

What @Braden Smith states is 100% correct. I would like to add that houses built before 1970 do NOT require an elevation certificate, but it generally helps.

If you are not going to be owner occupant, I would assume at least $700 for flood insurance a year, and thats if the property is raised above BFE (base flood elevation). If its less than BFE, I would get it qouted, as some slab houses can be way north of $2k per year.

FYI, I recently built a duplex in Gentilly that was 1.5ft above BFE, about 7ft off the ground, and my flood insurance was like $650/yr for $165k in coverage.

Mike Wood · Answer

@Brandon Clark Gentilly is a large area of NOLA.  There are nice some areas that have come back decently, and some that still have ways to go.  But it is only of the only areas of the city where you can consistently get housing for under $100/SF and still have high demand for renters.

I have property in Gentilly, and can say that it provides very good value with strong rents.  But I am particular about where in Gentilly I invest, as there are large chunks of it that have had little investment and are not very rent desirable.  Gentilly by the lake is starting to get expensive, which is reducing the value you can get.  There is lots of new construction in that area, which is helping alot.

Kimberly Jones · Answer

Getting an elevation certificate is the smartest thing you can do. I recently was able to lower the cost of flood insurance on one of our properties from $2,200. a year down to less than $500. Hands down the best $250. I EVER spent!

Troy Williams · Answer

So if I'm understanding correctly and the rates haven't changed too much since this last post,  an investment property, not in a flood zone would likely start at $700/annual.

What about Named Storm Coverage? Is this also required and if so, also based on elevation?

Add above to normal dwelling insurance and it seems we are creeping up to $300 to $400 per month just for insurance. Does that seem typical for New Orleans?

I am actively looking to buy my first property here and could use some insight for buy/hold strategy.

Tom Brooks · Answer

Flood zone properties can give gains to value add investors. I have a whole post about reducing premiums and a team that might be able to help you.

https://www.biggerpockets.com/forums/61/topics/364...

Brandon Clark · Answer

@Erin Plitsch Thanks for that insight. I haven't had a chance to look in that area yet. I want to find a part of the city that works for me. Everyone is telling me that it's so important to know your neighborhood, so I want to find an area where I can do multiple deals. There are a bunch of possible flips around pontchartrain park but I think that's what scares me. I think I will move a bit west to see if there is better pickings.

Erin Plitsch · Answer

@Brandon Clark Like most others have mentioned- it can be spotty for sure.   However, we recently moved to the Gentilly area and have been really happy here so far (but I'll be happier when our renovations are done, ha!).  We are East of Elysian Fields, as are a few other people I know who have recently moved to the area.   Seems like the "terrace" is hot right now (that's where the others I know have purchased- all owner-occupied, including couples, young families and a single gal)-  bounded by Mirabeau, Gentilly, Elysian Fields and People's.  We strongly considered a few properties a little North of those bounds, and ended up buying in Fairmont Park just South of Gentilly Blvd (my co-worker was convinced I was crazy, but we love our street).

Driving around worked great for us to figure it all out. We were using a VA loan so our criteria was a lot different for this home than our norm for an investment property, but as we walk/drive around we're seeing a lot of "potential next buy" properties in our area.  I've heard a lot of chatter about people wanting to move this way considering crazy rent prices in other parts of the city, so I think if you pick the right spot you could certainly do well in this area.

Braden Smith · Answer

Hey @Brandon Clark. For insurance agents I recommend Joe Molero with TWFG or Jeremy Scobey with Alternative Insurance Solutions. PM me for contact numbers.

John Maxi · Answer

@Braden Smith and @Mike Wood thanks for the insight. I'm at the stage where I'm trying to follow Branden Turner's advice to analyze 100 properties to learn the market. It will be really helpful to be able to take flood insurance info account!

Flood insurance estimates in New Orleans?

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