New flood maps are going into place for Galveston County Texas on August 2019. Its going to have a bigger impact in certain areas like League City. We want to discuss specifically how this city in the county will be impacted.
The last time flood maps where updated was 1999 as you can imagine alot can change in 20 years. Texas has seen some devastating flooding from hurricanes Ike and Harvey during that time frame. We have also seen major land development in this area in the last 20 years which can have a major impact on flood zones.
What Will Impact be in League City
According to Community Impact Newspaper when maps were originally put in place in 1999 there were only 1,265 home in the 100 year flood zone. We all knew this number would increase with population increase combined with land development. However most people had no idea that number would increase to 3.730 homes in the 100 year flood zone. This could have a major impact on property values in the area and the ability for people to afford a mortgage.
Property values could easily drop when these new flood maps go into place. One reason is that someone is not going to want to pay an additional $200 a month for house that is in a high risk flood zone when they could get more house for their money on a home that is not in the high risk flood zone. While homes that are being moved from a low risk flood zone, which is a flood zone X to a flood zone A or AE may not see a huge impact the first year, they could the second year.
Impact on Mortgage
Like many other coastal areas have shown us when an area is moved into a high risk flood zone it can have big impact on mortgages and the ability for someone to get a mortgage. What would you do if your mortgage increased by $200 a month tomorrow.
Well you would probably panic a little bit as maybe you should. This could possibly force you into a bankruptcy situation, so what if you want to but the home?
When purchasing a home mortgage companies use something called debt to income to determine how much house you could afford. Well flood insurance premiums just like home insurance premiums are part of this equation. So $200 a month could easily stop you from getting the home of your dreams or even your starter home. So what other options are available?
What are the Options
There are really three different options on the table when this happens in a community. You can do a policy through the National Flood Insurance Program, the private flood insurance market, or fight it.
National Flood Insurance Program
So when a League City or Galveston property is placed in a high risk flood zone the first thing people think about is the NFIP or FEMA. If you are going from a low risk zone to a high risk zone in Galveston then you have newly mapped flood insurance rates available. This is very important because it is very common for people in Galveston to be overcharged hundreds of dollars because a policy is not written correctly. When you qualify for new mapped rates you are basically getting the preferred rate for the first year. Each year after this your rate will continue to increase until the premium matches the flood risk correctly. That could mean a rate increasing 125% over a 5 year period since this is the current max renewal increase FEMA can do. So then what is the other option for flood insurance in League City and Galveston Texas? Well that would be private flood insurance.
Private Flood Insurance
Private flood insurance is just like it sounds. It is flood insurance that is provided by private companies in Galveston Texas. Because of this they can use their own underwriting guidelines and determine flood premiums differently. Private flood insurance can also decline Galveston properties depending on the risk. For example if a property has flooded in the last 5 years or a claim exceeds $50,000 than it is likely the private company would decline it. They could also decline it if it is in a floodway. If you are a good fit for private flood it could save you up to 50% compared to FEMA with more coverages. So we have talked about NFIP and private flood insurance, is there anyway to overturn these new maps?
Can You Fight It
Can you fight these changes? Yes you can now you might not when your case in Galveston like you might in other parts of the country. If any area has had a history of flooding then winning this fight is less likley. Something else that needs to happen is the lowest adjacent grade of your property needs to be above the base flood elevation by usually 1 foot in coastal areas like Galvestorn or League City Texas.
So maybe you have questions about what flood options are available in Galveston or League City Texas? Please visit our website Flood Insurance Guru