Things to Consider in Your Search for OBX Property
The old adage of "location location location" is a key factor in any home buying decision. But if you are buying property on the Outer Banks, you should consider additional factors as well. At Coastal Outer Banks Realty, we have the experience and knowledge to walk you through these and other factors that may impact your home search!
1. Know your Flood Zone before you buy. Properties on the Outer Banks will fall into one of four flood zones: X, AE, VE, or Cobra. What zone the property is located in along with other factors such as elevation, age and the structure itself are factored into your premium. Most properties on the Outer Banks are eligible for flood insurance through the National Flood Insurance Program up to $250,000. If you are securing financing for your property, you will be required to have flood insurance unless your property falls in an "X" flood zone. If you are considering properties that fall into a "Cobra" flood zone, it is important to note that you will not be able to obtain flood insurance through the NFIP program, which is likely to have a big effect on your insurance premium.
2. Read the small print when it comes to flood insurance. Most insurance agents on the Outer Banks have tragic stories of loss because people did not understand what their flood insurance would cover. Read the fine print! Flood insurance does not cover land, nor does not it cover belongings outside of an insured building such as wells, septic systems, walks, decks, patios, fences, seawalls, hot tubs, swimming pools and piers. The cost to repair these structures can run from a few hundred dollars to over a hundred thousand so understanding the cost of replacing these structures should you be the victim of a flood is imperative before you finalize your home search.
3. Know your town ordinances. The Outer Banks is made up of several communities and towns, all which have different ordinances and different tax rates. For example, some communities have dog-friendly beaches, while others do not allow dogs on the beach during the prime seasons. Some allow driving on the beach. Tax rates are also different for the various communities. Make sure you know the various tax rates and laws for the community you are considering before finalizing your home search.
4. It if seems too good to be true, it probably is. While the Internet is a great place to start your search for Outer Banks properties, it often will not tell you the full story. For example, if you see an oceanfront, single-family home on the market under $500,000, we can almost guarantee there is an underlying issue. If the property is sitting on a beach that has no dune structure, it could be the next victim of a storm. Perhaps it no longer meets Coastal Area Management (CAMA) setback requirements. If you are a cash buyer, then know the risks. If you are financing your property, these issues could affect your ability to get financing.
5. Good rental properties often to not make good year-round homes. Properties on the Oceanside or Between the Highways often make great rentals, but are necessarily built for year-round living. Why? Small closets; lack of storage; transitional neighbors, non-family friendly communities and small bedrooms are just a few possible reasons. If you are hoping to start with an investment property and want to convert it some day to a full-time residence, make sure your realtor understands your goal, and be willing to sacrifice rental income in the early years to find a property that will suit your ultimate goal.
6. Beach Access. While there are lots of things to do when visiting the Outer Banks, most people come want to go to the beach! Thus, know your proximity to a beach access if you want to maximize rentals and attract repeat renters.