Monday, June 11, 2018

Hawaii lava flow zones, home development, insurance rates, property values - Mary Cummins, real estate appraiser/broker

Hawaii, volcano, lava flow zone map, homes, development, vacationland, leilani estates, real estate, prices, property tax, risk, mary cummins, real estate appraiser, real estate, appraiser, broker, expert witness


The United States Geological Survey (USGS) oversees the Volcano Hazards Program (VHP). The VHP maps out past volcanic activity taking into effect topography to predict lava flow risk zones. The map above in the header photo shows recent lava flows. Below is a map of Hawaii with the lava flow zones.

Hawaii, volcano, lava flow zone map, homes, development, vacationland, leilani estates, real estate, prices, property tax, risk, mary cummins, real estate appraiser, real estate, appraiser, broker, expert witness


It’s common sense that no one should live in lava zones one, two and probably three. This is why years ago insurance companies would not give lava flow insurance to properties in zones one and two. This caused a problem for developers who wanted to sell homes in those areas in the 1960’s. If you can’t get lava flow insurance, you can’t get a mortgage. If you can’t get a mortgage, you can’t sell homes. This is when politicians did something reckless.

The politicians forced the insurance companies to offer lava flow insurance in zones one and two. The only way they could do this was to raise the cost of insurance for all people in the area to cover the higher risk.

If you look at the above map, you can see that the area that became Vacationland was wiped out in the 1960’s lava flow. All homes were lost. The area near Leilani Estates was also wiped out by lava flows. After the lava flows real estate developers started buying the worthless land. It couldn’t be used for farming or grazing as there was very little soil. By mid 1960’s they were marketing and selling this land to haoles on the mainland as vacation homes. Below are two ads from 1968 and 1969, less than a decade after lava wiped out a previous development.

Hawaii, volcano, lava flow zone map, homes, development, vacationland, leilani estates, real estate, prices, property tax, risk, mary cummins, real estate appraiser, real estate, appraiser, broker, expert witness

Hawaii, volcano, lava flow zone map, homes, development, vacationland, leilani estates, real estate, prices, property tax, risk, mary cummins, real estate appraiser, real estate, appraiser, broker, expert witness


Before the developers started selling lots they lobbied the politicians to build roads and provide utilities to these areas. The politicians owned lots of this land. One was them was Senator Kazuhisa Abe who started Vacationland in the 1960’s. He used his influence to get the state to pay for roads and utilities for this area. Generally the developer pays for streets, sidewalks, street lights, utilities for their development. They also contribute toward roads, highways if needed.

Human greed is what caused people to buy/sell land and homes in this area. The developer only cared about making money. He does not care about the residents living in the area. The people who bought the property just wanted cheaper, more affordable housing.

The people who lost their homes and had insurance may be okay. The insurance goes to pay off the mortgage first. If there’s anything left over, it can be used to rebuild or they can pocket the money. I doubt the government will allow people to rebuild in this area. It would make no sense to rebuild as there are no highways or utilities. The land is now worthless.

The people who did not lose their homes who are in the evacuation zones may be in the worst situation. Their home is worthless but because it wasn’t burned down they get no insurance money. They probably can’t even get to their home. Their homes are not livable as there are no highways, streets or utilities. They probably have a mortgage and still have to pay property taxes yet they can’t live in their home.

Based on human greed I see the same thing happening in the future. After a few years people will forget about the lava flow. Plants will eventually grow in poor soil over the lava flows. Homes will be built on this land and the process will repeat itself just like Texas rebuilding after every hurricane and flood using FEMA money.

The state should not allow homes in this area. It should be turned into a wildlife area and state park only. They shouldn’t even allow cabins in zones one and two. The state would not have to buy the land from the owners as it is worthless. The owners will stop paying property tax on the land and the state will own it within five years by default. The state could reduce their property tax to almost zero as the land is worthless. Still, it would not make sense for anyone to pay any property tax on this land. Time will tell if human greed causes a repeat of these events.

Mary Cummins of Animal Advocates is a wildlife rehabilitator licensed by the California Department of Fish and Game. Mary Cummins is also a licensed real estate appraiser in Los Angeles, California.

Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary Cummins-Cobb, Mary, Cummins, Cobb, real estate, appraiser, appraisal, instructor, teacher, Los Angeles, Santa Monica, Beverly Hills, Pasadena, Brentwood, Bel Air, California, licensed, permitted, single family, condo, pud, hud, fannie mae, freddie mac, uspap, certified, residential, certified resident, apartment building, multi-family, commercial, industrial, expert witness, civil, criminal, orea, dre, insurance, bonded, experienced, bilingual, spanish, english, form, 1004, 2055, land, raw, acreage, vacant, insurance, cost, income approach, market analysis, comparative, theory, appraisal theory, cost approach, sales, matched pairs, plot, plat, map, diagram, photo, photographs, photography, rear, front, street, subject, comparable, sold, listed, active, pending, expired, cancelled, listing, mls, multiple listing service, claw, themls,

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