As South Carolina’s population grows and sea levels continue to rise, a statewide panel of experts says now is the time to give homebuyers more transparency about what they buy, especially when it comes to living by the sea.
State law requires homeowners to complete a disclosure form, which is designed in part to alert the buyer to any previous or current problems with the property or home.
However, a recent report by the South Carolina Beach Conservation Stakeholder Working Group, which has been tasked with strengthening beach protection in the state, argues that the disclosure form is not reliable enough. This is one of the few conclusions made in its report by a panel convened by the Oceanic and Coastal Management Division of the South Carolina Department of Health and Environment. However, this was not part of the group’s official recommendations and changes to the form would require approval from the South Carolina Real Estate Commission.
Stakeholders discussed a disclosure form that will identify coastal hazards and explain the properties of the flood hazards they are facing.
Coastal hazards will include whether the property has undergone beach renovations and how often this has happened. Disclosure should include why erosion control structures such as seawalls or bulkheads were built there and the potential cost of maintaining them. Both indicate erosion threat levels.
State law currently requires certain disclosures that seafront properties are subject to coastal regulation. Homeowners must also provide local erosion rates as provided by DHEC most recently.
Additional information will include information on how often the object was flooded and when it happened. Also, if there was a major storm, how would it affect the property?
Due to the identification of the need for a more stringent form of disclosure, the group is pushing for public education and awareness to promote public understanding of the dangers of coastal property and the most vulnerable coastal areas.
When it comes to beachfront home ownership, Emily Sezo, senior program director for the Coast Guard League, says many homebuyers are not from the coast and don’t fully understand the dynamic nature of the beach and the risks it can pose.
“I think there are a lot of people on the coast buying this property who are completely unaware of the vulnerability they themselves have inherited,” Shozo said. “Are they financially ready for refeeding? Are they ready to declare a state of emergency on their territory? So that potentially the ocean would move towards them and become an active beach?”
Need for transparency as sea levels rise
More than a decade ago, the Coastal Change Advisory Committee, a group under DHEC’s coastal management, recommended that coastal hazards be part of the disclosure of information provided to homebuyers.
Common language about floods is now included. Otherwise, 13 years later, the required disclosures have not been updated to require more information about floods or coastal hazards.
Leading questions make up two lines of a six-page disclosure statement. These include: Is the property affected by flood hazards, wetlands, or flood hazard markings? And does flood insurance cover property? There are three options: yes, no or no submission. The latter option, in layman’s terms, means “I don’t know,” one realtor explained.
Only when the “yes” box is checked, the owner must provide an explanation and documentation.
Alex Butler, director of planning for the South Carolina Sustainability Authority, said the lack of representation leaves some people vulnerable to gaps in information about what they buy.
“What we don’t want is people investing in real estate and making these really big life decisions without having a full picture of what their future risks are,” Butler said.
As the population of South Carolina — the sixth fastest growing state in the nation — grows, the acceleration of development goes hand in hand. Further development, especially in coastal areas, could make areas more prone to flooding and exacerbate beach erosion.
According to a previous report by The State, sea level rise will cause an intense shift in coastal flooding over the next 30 years as it causes tides and storm surges to move inland. A 2022 NOAA report notes that moderate flooding will occur more frequently and sea levels are expected to rise by as much as 3 feet in the next 50 years, NOAA data says.
“I think it’s kind of a writing on the wall and it’s time to do something,” Shozo said.
The dangers of life on the seashore
In a November 29, 2021 lawsuit, Rodney and Felicia Kane, who own a home in Debordieu, alleged that two years after buying the property for $2.1 million, they discovered that sandbags had been buried there to compensate for “significant erosion” , according to previous reports. state.
The Cains said the sandbags were placed by the previous owners and buried, which obscured how severe the erosion was. When the storm hit and the tide came in, hundreds of bags began to wash away. According to the lawsuit, the Cains want their former homeowners to pay them compensation for not disclosing hidden sandbags and the extent of beach erosion before selling the house.
According to the lawsuit, because they say the issues were not disclosed, they incurred “heavy expenses” to protect the home and the value of the property declined.
“We heard about so many different experiences,” Shozo said. “It just goes to show that the process isn’t necessarily consistent for every property owner.”
About 30 minutes north of Debordieu is Litchfield Beach, another example of the dangers and sometimes unexpected costs of home ownership by the sea. One row of houses built along a narrow peninsula was in danger after erosion ate into the coastline.
Because it is not a public beach, homeowners did not benefit from public money when they tried to renovate the beach. Instead, these homeowners had to pay “somewhere around $300,000 a piece” for the renovation project, according to a previous report from The State.
After that, some homeowners turned around and sold their property, fearing they would end up having to pay to upgrade again.
Greater transparency is part of the puzzle in helping people understand what it means to own vulnerable seafront property.
“If that’s the risk they’re willing to take, then it’s okay. People make decisions like this all the time to take these risks,” said Amy Armstrong, director of the SC Environmental Law Project. “But they have to be informed decisions.”
Some information is available, such as DHEC’s interactive website that details nutrition renewal projects across the state since 1979. But there is no one-stop-shop for potential buyers to understand the dangers of the coast or the risks of flooding to their property.
Cedzo said DHEC’s coastal management office is receiving calls from potential buyers about properties, but if the agency doesn’t have time to do so for every potential buyer.
To a large extent, current information about coastal property hazards or flood risk depends on the real estate agent and seller.
Closing information gaps
Peter Geary of RE/MAX Island Realty at Hilton Head said a “middle ground” is needed if the disclosure form becomes more reliable.
He agrees that the form should be completed in its current form as truthfully and accurately as possible. But he also has concerns.
A potential buyer needs to know if there is something wrong with the property, and at the same time, Geary says, he doubts whether the seller would have enough knowledge to accurately fill out additional information about the coastal hazard. At the same time, the more problems are identified with real estate, the more it will fall in price.
He wonders if the homeowner will know the details of the upgrade if it happens on their property and if it is expected in the future. Will they understand why the erosional structure is nearby and what shape it has? Or could they remember cases of flooding at home and the associated repair costs?
He’s not so sure. And he believes that if the disclosure form becomes more restrictive, a professional may be required to evaluate the elements of the disclosure form.
For now, Geary is focused on getting his clients to take the current disclosure seriously because the form has a clear and important statement.
“If the owner does not answer yes or disclose information, and the owner knows there is a problem, the owner may be liable for fraudulent or negligent misrepresentation.” In addition, according to the document, this may result in the owner having to reimburse the buyer for actual damages, legal costs and attorneys’ fees.
Discussions on changing disclosure forms are at a very early stage and will require approval from the South Carolina Real Estate Commission.
In the meantime, Shozo said DHEC is working on a public database that will provide statistics in one place. According to the working group’s report, the “Atlas of Beaches” will include erosion rates, erosion control structures, emergency orders, renewal projects, and special permit projects.
This could also include flood information, Butler said.
“We also want to be very careful not to post misinformation in the real estate industry because we understand that there is a financial aspect to it,” he said.
Working group recommendations
The update of the disclosure forms was one of several waterfront conservation proposals that the 17-member working group outlined in their January report. However, this was not included as a formal recommendation.
Three of the six recommendations related to pilot research projects. The report states that, since 1977, state law has allowed exceptions for research conducted by government agencies and educational institutions, as long as they “do not cause material damage to the flora, fauna, physical or aesthetic resources of the area.”
The wording was updated in 2014 to allow these projects to address erosion issues.
The working group wants more “clarity on design standards, specifications and process” and agrees that when it comes to erosion control projects, “preservation of the dry sandy beach and beach/dune system should be the primary goal. ”
They also insist on requiring public notice of proposals.
In addition, the report calls for strong action to clarify the ban on erosion control structures such as breakwaters. For Butler, his primary concern was maintaining the function of the beach, a place known for people relaxing, where sea turtles nest and waders feed.
Shozo said the next step for DHEC’s coastal resource management will be to determine which recommendations need to go through regulation and which may require new legislation.
Below are the following six recommendations made by the group:
Define beach conservation
Establish a technical advisory committee on beach food.
Establish an ad hoc technical advisory committee for the pilot project.
Improve pilot project authorization process
Change the normative language of the pilot project
Prohibit the construction of structures to prevent erosion in the critical zone of beaches.