All Forum Posts by: Sarah Kassem

Hello,

I'm an out of state investor looking to venture into Louisville, KY. Does anyone have any property management company recommendation? I did a quick search and there are a lot out there, so hoping to narrow it down based on personal recs. We are looking at purchasing 2-6 unit properties on the east side of town (east of Old Louisville) that would likely involve medium to light rehab, so ideally the PM company would also fit this target.

Would love any tips or recommendations, thanks!

If you were in the 100-year flood zone, you would know about it and be required to get insurance. The fact that your lender does not require flood insurance means you are not in the 100-yr flood zone. Also $500/yr is cheap for flood insurance indicating that your are at low risk of flooding. However, there are other types of flooding that are not looked at when assessing the FEMA flood risk that might be worth getting insurance for, such as storm water flooding. For example, if it rains a lot and the street drains backup and all that rain water runs off from the street into your basement. I would check with that insurance quote to see what type of flooding is covered.
Seems you're in the phase of your career where you are protecting what you already have, so for that, $500/yr is minimal. 

It's called the 50% Rule. If your rehab is more than 50% of the assessed value, you need to raise the property to above the Base Flood Elevation. Here is a good summary.

No, I'm pretty sure you don't have an obligation to inform tenants of flood risk

FEMA shows the flooding based on existing conditions (ie no sea level rise, climate change, ect). Zones X means it is in the 1 in 500 year flood zone, and lenders generally only require flood insurance if you are in the 1 in 100 year flood zone. Flood Factor shows future flood risk (ie their models will incorporate increases in flooding/rain due to climate change). FEMA flooding also only shows flooding from rivers or oceans, while Flood Factor shows flooding from rivers, oceans and rainfall.

In terms of adding another unit to the basement, that is 100% based on your local zoning and codes.

I would not stress too much about the Flood Factor score. Any sort of climate change model, no matter how sophisticated is still a best guess on what may happen. They are good for large scale and long-term planning, but loose their effectiveness when you zoom down to the parcel level.

For mitigation, I would:

- Talk to neighbors/city/floodplain administrator to see if there has been any flooding in the past

- Manage the drainage on your property by installing french drains, ensuring the ground slopes away from the house, install a sump pump for the basement in case you do get flooding.

- Be aware of storms passing through so you be prepared in case you do get flooding.

I would also check the FEMA flood maps (msc.fema.gov) to see if it is in a floodzone. There is a rule (I'm not too sure of the specifics so please check) but it's something like if you rehab a property to more than 50% of its value, you also need to raise it to above the flood level. So that could be a major deal breaker. Found this from google:
The 50% Rule is a regulation of the National Flood Insurance Program (NFIP) that prohibits
improvements to a structure exceeding 50% of its market value unless
the entire structure is brought into full compliance with current flood
regulations.

What scenario were you looking at for the Flood Factor map? Is it coastal or river flooding? They could be taking future SLR into account, which may be a risk for some people, however it is a very long-term risk that may not be realized for 20+ years. My guess is you would have sold by then.

I also work in climate science field and I mainly just look at the FEMA flood maps to see the existing flood risk, and because I'm in the field and have the know how, I look at things like topography, stormwater flooding, etc. It's great that you are above grade. Try finding some long-term residents and ask about past flooding/storms. The county floodplain administrator might have some more insight as well.

Hello,

Posting on behalf of a friend that is house hacking in Oakland. They are having trouble finding an insurance provider for their primary. It is an official duplex with a backyard cottage, so 3 units total. They are living in the top unit, renting out the bottom unit as a LTR and the backyard cottage as STR/MTR. Any suggestions for an insurance provider or broker?

Want to add one quick note about areas behind seawalls. They may help to protect against flood damage, but will not help to reduce cost of insurance. FEMA and I'm assuming insurance carriers,  only consider the effect of a flood protection structure (such as a seawall) if it is accredited. This means it must be designed and built with specific engineering requirements and most of those seawalls are not.
You are on the right track with figuring out the BFE and elevation of your ground level. The USGS map should only be used for approximate elevations, it is no way accurate enough to figure out the exact elevation of your parcel. Try looking for LiDAR data provided by the county/city for more accurate elevation data. But again that will only give you a slightly better estimate of elevation. To get the exact ground elevation you will need a surveyor to measure the lowest floor elevation of your building. This link gives guidance on what is the lowest floor elevation of your building.

This can only happen if the property is no longer in the floodzone, which occurs if it is raised in elevation. You would need an elevation certificate by a surveyor showing that the ground floor of the property is higher than the flood elevation (ie the BFE). Being removed from the floodzone can also happen if the city/county build a new levee to protect from flooding (this is rare and will take several years).

Flood maps are developed based on river/rainfall data and hydraulics. If you think your property really is not at risk to flooding, you would need to hire a civil engineer to conduct an hydraulic analysis showing that it's not in a floodzone. And even with that FEMA, can choose to not accept that analysis.