Rising flood rates could increase renovation, demolition in Beaufort County

dburley@islandpacket.comFebruary 23, 2014 

An officer with the Beaufort County Sheriff's Department uses her patrol vehicle to block off the S.C. 170 exit onto Eastbound U.S. 278 in Bluffton after heavy rain in February caused it to flood.


With flood-insurance rates rising for many across Beaufort County, some owners are taking steps to lift or rebuild their homes above flood level, hoping to lower monthly premiums.

Several area homebuilders say they've been approached by owners interested in lifting their houses by a few feet. They've also demolished several homes to rebuild according to updated codes.

But this is only the beginning, the builders say.

If the federal flood-insurance hikes aren't delayed -- a bill to do so has passed the U.S. Senate and is pending in the House -- many residents would save money in the long run by lifting or rebuilding their homes to avoid skyrocketing rates, according to area builders, flood-plain managers and a study by the Federal Emergency Management Agency.

Otherwise, communities such as Fripp Island, Sea Pines on Hilton Head Island and the Old Point neighborhood in Beaufort will be largely under flood level -- and paying the price for it.

Some estimates have premiums reaching $20,000 a year.

"I think we are going to see it more and more, depending on how (the legislation) turns out," said Allen Patterson, who owns Allen Patterson Residential in Beaufort. "Otherwise, people are going to be paying a lot more. Everybody will."


Patterson said his construction firm has torn down two homes on Fripp Island in recent months to rebuild above flood level.

Mike Lynes, owner of Lynes Home Inspections on Hilton Head Island, said he's done smaller projects on homes to lower the flood risk and improve insurance rates. For example, he has added flood vents to garages of older homes.

These projects are meant to reduce the pain of national flood-insurance rate hikes that took effect Oct. 1. The hikes are part of a bill Congress approved that seeks to keep the National Flood Insurance Program solvent after catastrophes such as hurricanes Katrina and Irene left the program $24 billion in debt.

Key to the congressional act is ending subsidized flood-insurance rates, so homeowners' premiums reflect the true risk of living in a flood zone.

For homes built before current flood maps went into effect, subsidized rates will be phased out at 25 percent a year until the premium reflects true market risk. In others cases -- as with the sale of a home or a lapsed policy -- the subsidy will be wiped out all at once.

On Hilton Head Island, owners of 800 homes eventually would be expected to pay full price, according to town flood plain manager Richard Spruce.

Spruce said he's spoken with several residents interested in lifting their homes. He has also inspected at least 10 houses to determine where changes could be made to reduce the price of insurance.

Down the road, he expects that number to increase.

"As implementation actually starts, when people go out to renew their insurance, there will be more and more people becoming aware of this, if they aren't already," he said.


To prepare for the new rates, many around the county are getting elevation certificates from surveyors. The certificates, about $400 each, give insurance companies the information they need to set rates, ensuring homeowners are paying the right rate for the flood zone they're in.

Terry Hatchell, president of Surveying Consultants in Bluffton, said business has doubled since the flood-insurance reform passed.

"Without the certificate, it's hard to know if you're paying the right rate," he said. "Homeowners are realizing it's powerful information."

Hatchell's surveyors often suggest ways homeowners can reduce insurance costs. One solution, he said, is lifting the home.

Beekman Webb, who owns Beekman Webb Construction in Beaufort, said he could lift a frame house built in the 1970s for about $25,000.

Lynes, the contractor, estimated it would cost $75,000 to lift a home in Palmetto Dunes on Hilton Head.

"But really it depends on the house," he said. "You can't have a sprawling ranch (house) and lift it inexpensively."

A 2013 FEMA study concluded that homeowners in the lowest flood zones could save $90,000 over 10 years if they lifted or built their houses three feet above base flood elevation.

Many are weighing the immediate expense against the long-term cost of higher premiums as they wait for Congress to act on the measure to delay the premium increases. If the rates stay on the books, paying for construction might be the best way to reduce costs.

"Sometimes, it is as simple as putting openings in a few vents," said Lisa Jones, who owns Carolina Flood Solutions, a firm she started to help people lower their flood-insurance payments. "Sometimes it's as complicated as demolishing a house and rebuilding it."

Follow reporter Dan Burley at twitter.com/IPBG_Dan.

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