FEMA's "50 Percent Rule"

The 50% rule dictates that a property must be updated to meet current flood codes only if it has been significantly damaged or improved. But what does "significant" mean?

According to FEMA, "significant" is defined as 50% or more of the property's appraised value, which is why it's called the "50% rule." Therefore, any repairs, renovations, or additions must not exceed 50% of the property's appraised value.

For instance:

If your home is valued at $350,000 and you plan to remodel, you can only spend up to $145,000 on the renovation. If your renovation costs reach $150,000, it would be deemed "significant," and FEMA would require you to update the entire property to meet current codes. This could involve spending thousands of dollars to elevate the property's foundation above flood level.

If you are unsure on how to find your FEMA letter, visit your county's property appraisal site.

For example: Pinellas County Appraisal Site - https://www.pcpao.gov/

Type in your address, on the right hand side, hover over tools and it will bring out a menu, click FEMA/WLM letter. This will indicate what your values are. 

Exclusions from the FEMA 50 Percent Rule

Certain scenarios exist where the expenses for repairs or renovations are not factored into the 50% rule. Although exceptions to this rule are limited, they are justified.

• • Projects aimed at rectifying health, sanitary, or safety code violations, as identified by a building official, are exempt if they are essential for ensuring safe living conditions.
     
    • This exemption does not apply to structures deemed "Substantially Damaged."
  • Substantial improvements to historic structures may be exempt with written approval from the Florida Division of Historic Resources, ensuring preservation of historical integrity.
  • Costs associated with storm damage mitigation, such as installing storm shutters or impact-resistant glass, are excluded from the 50% Rule, provided these costs, combined with other improvements, do not exceed 50% of the structure's market value within a year.
  • Expenses related to planning, specifications, surveys, and permits are not counted towards the 50% Rule, allowing for comprehensive preparation and compliance without affecting the financial threshold.

For more information on navigating the 50% rule and your home renovations - reach out to kerry@averyconstruction.com.