Who will live in flood-prone areas? Housing market questions raised after Florence

Horry County has been one of the fastest growing regions in the United States, due in part to the area’s reputation as an affordable community near the ocean, but some believe that designation may be in jeopardy after three catastrophic flooding events in four years.

Sharon Pollard, a resident of Longs, believes the local housing market may soon be in crisis after Hurricane Florence drenched North and South Carolina, dumping dozens of inches of rain and flooding nearly every community near the Waccamaw River or Intracoastal Waterway.

“You’re going to have a flood of houses for sale, a flood of houses that need be flipped as people walk away,” Pollard said Tuesday during a county council meeting.

The fate of the market really depends on what home buyers think, said Professor Matt Kahn, an expert on how climate can affect housing prices. If an area gets a risky reputation, he said it can affect property values because cheaper homes will make people comfortable with assuming the potential for risk.

Quality of life

At a Horry County council meeting, several other community members spoke against development, specifically a proposed project in Longs on Bucks Creek Road that would bring over 1,000 new units to the area. A major concern of these Horry residents was that too many homes already are built in the area and will drive down demand, leaving lots empty.

Council members debated the project and how it might harm existing residents of the area. It was approved, 7-4.

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The quality of life people expect when they move to an area can be a selling point to potential home buyers deciding their location. Obviously, routine flooding negatively impacts an area’s residents, even if water does not reach their houses.

There could be winners in terms of home price, Kahn said. In areas that did not flood, homeowners could see an increase in property value.

The ultimate impact of a disaster on markets comes down to the region’s competitive edge and reputation in the eyes of home buyers. People looking to relocate to Horry County will be wary of frequently flooded homes, raising the desirability to live farther from where the rivers crested, increasing the value of those homes.

But if the county becomes known as the area that always floods, people might begin looking for suitable alternatives.

The free market

Horry County’s growth shows people still wanted to come even after previous major flooding events like Hurricane Matthew in 2016. County Council member Dennis DiSabato said you cannot stop building just because of one, unpredictable storm. Even then, the county only has so much power of what gets built.

“Telling people they can’t build on their property is unconstitutional,” he said.

The county does have power to guide development through building codes, permits and zoning districts, but ultimately DiSabto said property owners will find ways to legally build on their own land to meet a growing demand for homes.

Pollard’s concerns were that the impact would be so negative that people will choose not to come here, regardless of home pricing or availability.

Brett Branham, an attorney with Tide Law Firm in Myrtle Beach, said that the biggest impact for him is going to be a lull due to week-long closures of business and legal offices. He expects things to pick back up as time passes and people begin house shopping. His law firm has seen this slow-down, but hasn’t had anyone back out of a deal.

DiSabato, who also works in real estate law, said that his practice has closed 20 homes since Florence hit the area.

While the flood might affect the price of homes, DiSabato doesn’t think it will affect demand overall, especially in areas that did not flood after Florence. This was a big reason he voted for the project in Longs, it did not flood in the most recent storm.

What can be done?

Horry County Storm Water Director Tom Garigen said that the county already has some of the strictest policies in the nation for stormwater drainage, but some homes were built before the policies went into affect.

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The current policy requires newly built subdivisions to release water into the river 20 percent slower than before the development was constructed. This helps protect homes from 25-year flooding events or getting 8 inches of rain in 24 hours.

Homes built before stormwater policies were enacted in the early 2000s and then updated in 2015 and 2017 are at higher risk of flooding from rainfall.

The flooding from Florence, however, was unprecedented and largely did not happen because of rainfall in Horry. Garigen said hypothetically, Horry County could get no rain at all, but if abnormally heavy rainfall hits North Carolina, everywhere down river will eventually flood.

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Both Garigen and DiSabato agreed that there is little the county can do to stop such massive, unpredictable flooding, especially in terms of homes already built.

Kahn said that there are ways for private citizens to protect from flooding, like building homes on stilts or creating barriers or using water-resistant construction materials. All of these techniques already have been used in Horry County. However, those products cost more money than many middle-class residents can afford.

If flooding becomes more regular, Kahn hopes that competition over customers will help create new products and lower the costs through mass production. If homes can be built to survive catastrophic floods, then that might mitigate the risks associated with living in or adjacent to a flood-prone area.

“As enough middle-class people make these demands, capitalism will pick up on it,” he said.