March 3, 2018

Hatteras Island Real Estate Coastal Barrier Resource Areas

Associate Broker, Outer Beaches Realty

Living on an island located 30 miles from the North Carolina mainland in a place that is subject to severe storms and high tides, it is only natural that flooding is a frequent topic of discussion. And, when the conversation turns to flooding, at some point the subject of flood insurance is almost sure to arise.

While flood insurance is readily available at a reasonable cost through the National Flood Insurance Program (NFIP) for most locations on Hatteras Island, were you aware that there are a few places on the island where NFIP insurance is not available? These places are Coastal Barrier Resource Areas (CBRA), commonly called “COBRA areas”. There are only two COBRA areas on Hatteras Island. One is located in a portion of the soundside in the Kinnakeet Shores Subdivision in Avon, and the other is in the vicinity of the elementary school in Buxton. 

As background, in the early 1980s, Congress recognized that certain actions and federal government programs subsidized and encouraged development on coastal barriers, resulting in the loss of natural resources; threats to human life, health, and property; and the expenditure of millions of tax dollars each year. To remove federal incentives to develop these areas, Congress passed the Coastal Barrier Resource Act in 1982. This legislation created the Coastal Barrier Resource System (CBRS) which established CBRA areas around the United States, in the U.S. Virgin Islands, and in Puerto Rico. The U.S. Fish & Wildlife Service has operational responsibility for the CBRS.

While the federal government generally cannot restrict the development of privately owned property, it can, however, influence the desirability of development by making these areas ineligible for most new federal expenditures and financial assistance. Areas within the CBRS can be developed provided that private developers or non-federal parties bear the full cost.

There are three principal considerations that affect properties located in CBRA areas.

  1. Flood insurance coverage through the National Flood insurance Program is not available for new construction in any CBRA within the Coastal Barrier Resource System after the effective date of the CBRS. Flood insurance may be available through private companies. The practical implication of this restriction is that the cost of flood insurance issued by private carriers is significantly more expensive than flood insurance through the NFIP. As an example, if the cost of flood insurance for a 3-bedroom home insured through the NFIP was $1,000, the cost for private flood insurance could be $5,000 or more.
  2. Federally related, guaranteed, or insured loans are not available to finance purchases within CBRA areas. Financing may be available from private sources.
  3. In the event of a natural disaster, most federal funding for disaster relief is not available to owners of properties within CBRA areas. Exceptions exist for emergency actions in a federally-declared disaster area which are essential to the saving of lives, the protection of property, and public health and safety as long as certain criteria are met. Assistance through private or volunteer agencies may be available.

If you would like to get an idea of whether a specific property is located within a CBRA area, go to – - and in the box “find a location” enter the address of the property. For a formal, written determination of whether a property is located in a CBRA, go to the U.S. Fish & Wildlife Service web site at, and follow the instructions for requesting a letter of determination. A survey will also show if all or a portion of a property lies within a CBRA area.

Owners or prospective buyers of properties located in CBRA areas who would like a more detailed explanation of the Coastal Barrier Resources Act and its provisions should contact an insurance agent, a lender, an attorney, or a Realtor who is familiar with the Coastal Barrier Resources Act, subsequent revisions, and related observations.

Questions and comments may be sent to Tom Hranicka at P.O. Box 280, Avon, NC 27915 or by e-mail to [email protected].

Copyright 2018 Tom & Louise Hranicka.  All rights reserved.

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