How Does FEMA’s 50% Rule Affect Home Renovations In Tampa Bay

By Grayson Silver

On December 31, 1974 the Federal Emergency Management Agency (FEMA) established specific guidelines, the National Flood Program (NFIP), pertaining to substantial improvements or damages to existing structures  whose lowest habitable floor does not meet or exceed the current Base Flood Elevation (BFE) specified on the Flood Insurance Rate Map (FIRM).  These guidelines are referred to as the 50% Rule or the Substantial Improvement/Damage Rule.

To put it in its simplest terms, any structure that is to be improved or has been damaged by any cause for which the renovations or repairs will cost 50% or more of the assessed building value, that structure must be elevated and brought into compliance with the existing FIRM.  This means if the lowest habitable level of your home is below the current Base Flood Elevation you must raise that level above the BFE or you may only complete renovations or repairs to your home for the cost of 50% of the structures assessed value (i.e. if your structure is worth $100,000 you may perform renovations not to exceed $50,000 in cost, but you also want to use all fancy equipment like the best MIG welder, right?).  It is recommended that anyone attempting to renovate their existing home, whether they are below the existing flood plain or not, contact a reputable architect to help guide them through the nuances of the process.  As we discussed in earlier post, if your renovation requires structural work or exceeds a particular value you or a contractor will be required to hire a design professional and have them sign and seal your construction documents.  Why have someone else’s architect when you can have your own. (see earlier post: “When Do I Need An Architect” & “What Comes First, The Contractor Or The Architect”)

In addition, many communities also implement additional “free-board” requirements.  For instance, St. Petersburg where our office is located, enforces a 1′-0″ free-board ruling. This means that an additional 12″ in elevation is required to meet the local municipality flood plain (i.e. if the FEMA flood plain is at elevation 10′-0″ the local flood plain elevation requirement will be 11′-0″)

This ruling is a potential cost that home owners and buyers need to be aware of in the Tampa Bay area as many of our existing structures fall below the current benchmark established by FEMA.  Here are a some of the frequently asked questions pertaining to the 50% Rule:

1 –    What is considered to be substantial improvement?

Substantial improvement is any reconstruction, rehabilitation, addition, or other improvement to a structure whose cost exceeds 50% of the market value of the structure before the start of construction of the improvement.

2 –    What is the market value of my home?

Market value is the assessed value or depreciated appraised value of the structure. If you are making business out of buying houses, you might be interested at Seller Lead Hacks top real estate investor keywords, because market value is not the only factor that helps to close the deal. The City of St. Petersburg determines the market value by either adding 20% to the Pinellas County assessment for ad valorem taxation for the structure only or the home owner can provide an independent appraisal for the structure only, prepared and certified by a Florida licensed appraiser.  It is very important to note that the market value is assessed for the structure only and does not include the value of the land. If you are a self-employed real estate investor looking for a local real estate lending, visit Many new home buyers who seek to renovate their newly acquired home are often surprised to learn that they can only renovate their home for a fraction of their perceived value. This refers to roofing services, too. Check at:

3 –    Are there any items that can be excluded from the cost of improvements?

Items such as plans, specifications, surveys, building permits, architectural fees, contractor profit & overhead are exempt.  Also improvements to the land such as; driveways, pools (note: keep in mind the best service for pool, pond, lake care – Commercial Lake Maintenance & Repair Company | Lake Management Inc), seawalls, etc. are not included in the 50% rule value.

4 –    Are substantial improvements cumulative?

Yes, depending on your municipality’s by laws.  In St. Petersburg, structures located within a special flood hazard area can be improved up to 50% of the structures value without becoming base flood elevation compliant cumulatively as long as the renovations do not happen concurrently.  In other words, you can complete a renovation to your home based on its current market value.  Once that renovation is complete, you can have an updated appraisal of the newly renovated structure performed and then begin a second renovation based on 50% of the new appraisal value.  Other municipalities may require a 12 month interlude between renovation projects.

5 –    How is the value of an improvement determined?

The City of St. Petersburg uses a form for additions and modifications specific to 50% Rule applications that must be completed and signed by the contractor or owner-builder.  This form includes copies of the construction contract and subcontractor bids.  Based on the answers and information provided, the city evaluates the cost of improvements to determine if they are fair and reasonable.

6 –    What is the Base Flood Elevation (BFE) and how do I determine my property’s BFE?

The BFE, which has been determined by FEMA, is informally referred to as the 100-year flood and is the national standard used by the NFIP and all federal agencies for the purpose of requiring the purchase of flood insurance.  Copies of FEMA certificates on all buildings within the City of St. Petersburg’s boundaries can be viewed at  Other municipalities BFE can be accessed by visiting the city in questions official web sites.

7 –    How do I find out the elevation of the lowest floor of my house?

In order to determine what elevation a structure was built at, you need an elevation certificate.  You can visit the City of St. Petersburg web site listed above to determine if there is an elevation certificate on record.  If there is no elevation certificate on record, you will need to contact a state registered land surveyor to provide an updated elevation certificate.

8 –    Why should the home owner suffer what seems to be a penalty for renovations?

Per the FEMA website ( “The underlying principal for counting extra cost associated with more expensive materials, labor, or design is the added real property that would be located in a special flood hazard area and that would be at risk to flood damage.  It should be noted that in some form, the Federal Government (the NFIP, FEMA, or various disaster assistance programs) would likely be obligated to pay a portion of or all future damage to these more expensive improvements.  In addition, structures located in a special flood hazard area that are not elevated to or above the BFE pose threats to the health and safety of the occupants of these structures.  Over time it is not only important to protect the property of the existing structures through substantial improvement, but also to protect the health and lives of the public citizens that occupy them.”

Each municipality has its own variance of FEMA’s 50% rule.  It is important for a home owner or home buyer to understand the requirements for improving your existing or newly acquired home.

Perspective home buyers should ask their realtors for additional information concerning any potential new home’s flood zone risk.  If a home is deemed to be below the BFE, they should ask for an assessed market value (which a ballpark figure can be deduced by adding 20% to the county’s assessment for ad valorem taxation for the structure only) and they should factor the potential cost or limitations of any new renovation when making a decision as important as their next home.

In this field of real estate investing, waterfront properties and special flood hazard areas, realtors, developers, contractors, and architects should work diligently together in order to provide the new or existing home owners with the best possible scenario for their investment.

Anyone with additional questions can feel free to contact the office of Architect Larry LaDelfa at 727-821-5779 or at  Please feel free to visit our website @ or download our eBrochure to view some of the projects completed by our office.

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