Earlier in the year I published a blog on the unprecedented flooding in Colorado: http://cohardmoney.com/blog/2013/10/2013-colorado-floods/
I recently read an article in the Denver Post: http://www.denverpost.com/news/ci_24809765/state-update-maps-many-damaged-homes-not-floodplain where it states up to 17% of the houses that were impacted by the floods were not in flood zones. This creates an interesting conundrum for home owners and lenders. Before making a loans lenders pull a flood report and if a home or commercial property is located in a flood zone (typically any property other than zone x)
Can property owners rebuild in newly created flood zones where their prior houses were located? Unfortunately in the new flood zones many of these homeowners will be unable to obtain insurance and therefore financing. These homeowners will lose substantial value in their property (the value could be totally zero if the new property is all in the eye of the flood plain The changes in flood zones is definitely an unfortunate situation for many homeowners with no good solution. It is extremely sad because many of these homeowners that purchased these properties did all their due diligence and everything right on their purchase and yet they could be financially ruined. It will be interesting to see how the changes in flood plains and impacts on individuals and communities is resolved both by the state and federal government