Why Outer Banks houses at risk of collapse bought by government

The two houses at the end of East Beacon Road in Rodanthe, N.C., sit precariously at the edge of the pounding surf.

Fierce storms and rising tides have clawed away the sand beneath them, pummeled nearby dunes and undermined septic systems. The pair of homes seem destined to one day topple into the Atlantic Ocean, the way a growing number have in recent years along this stretch of the Outer Banks, where the rates of erosion and sea level rise are among the most rapid on the East Coast.

Given that reality, it might seem surprising that 23298 E. Beacon Rd. and 23292 E. Beacon Rd. sold on the same day recently. Perhaps even more surprising was the buyer: the National Park Service.

After spending more than $700,000 for the salt-sprayed vacation homes, the federal government plans to promptly tear them down and turn the area into a public beach access.

The move marks a unique and possibly groundbreaking chapter in the deepening dilemma of what to do with imperiled coastal homes, which are becoming only more vulnerable amid rising seas, more intense storms and unceasing erosion.

Often, states and localities have little money for buyouts of such places and little political will to pursue the controversial topic of retreating from threatened shorelines. Homeowners face unenviable options of letting their homes become inundated or spending large sums to try to move them, both of which have happened in Rodanthe.

“Up until we did this, there didn’t appear to be any tools in the toolbox for us to help mitigate the problems associated with these threatened oceanfront structures,” said David Hallac, superintendent of the Cape Hatteras National Seashore, and the man who engineered the purchases.

In the recent case, Hallac tapped funding from the Land and Water Conservation Fund, established by Congress in 1964 to safeguard important cultural and natural areas, and to expand recreational opportunities for Americans. Funded by earnings on offshore oil and gas leasing, it does not rely on taxpayer dollars.

Hallac said he is not aware of other examples of the Park Service using the fund to purchase homes made unlivable by erosion and sea level rise, only to tear them down. But in this case, he said, it made sense.

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He bought the house 9 months ago. Then the ocean swept it away.

As long as the houses teetered at the ocean’s edge, visitors couldn’t safely navigate the beach. Turtles and birds couldn’t use that stretch of shore as they normally would. The houses’ septic systems were at repeated risk of inundation. And if or when the homes fell, any collapse posed an environmental and public health threat that would stretch for miles as debris got swept away.

“It will be a safer beach,” Hallac said, adding that once the homes are demolished, he plans to explore the possibility of scaling up this type of approach in nearby areas where shifting sands have left houses at the brink of collapse.

Finding solutions, finding money — and finding agreement — to the deepening problems of erosion in Rodanthe have been difficult to come by.

This scenic sliver of the Outer Banks has seen multiple houses crumble into the ocean over the past several years, and many more remain at risk of a similar fate. Some homeowners have spent hundreds of thousands of dollars paying to move properties farther from the pounding surf. And residents have implored local officials and the Park Service to do more to protect the fast-eroding shoreline.

An engineering assessment undertaken this year by Dare County, N.C., where Rodanthe is located, found that the type of extensive beach nourishment that many residents want for the area would cost as much as $40 million. Maintaining that beach over 30 years would cost more than $175 million, the report found.

By comparison, the balance in Dare County’s beach nourishment fund, which comes from a tax on hotels and vacation rentals and must go toward multiple projects in the sprawling county, stood at $6 million earlier this year. No large influx of state or federal money for a beach nourishment in the community is imminent.

Rob Young, a Western Carolina University professor and director of the Program for the Study of Developed Shorelines, believes communities should consider more creative and thoughtful ways to retreat from eroding and flood-prone shorelines. Retreat, he often says, can be managed or unmanaged, and in many coastal communities it has largely been the latter so far.

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Young has advocated for more extensive buyouts and believes the Park Service purchase is “important because it is finally a successful buyout on an oceanfront property that I can point to,” he said. “We need models for how this can happen and where the money can come from.”

The two homes the Park Service bought are not a panacea, of course, and it remains to be seen if such an approach can be scaled up. But even the symbolism of what the purchases represent — creating a public beach access from what is a public hazard — is a critical example of what is possible, Young said.

To purchase the homes, the government first undertook a detailed appraisal of each property, and ultimately offered that price to the homeowners. In this case, both homeowners accepted.

The Park Service purchased 23298 E. Beacon Rd. for $471,000, as the 1,920-square-foot house still had a working septic system and was livable. The purchase price for 23292 E. Beacon Rd. — a 1,568 square foot, four-bedroom house that had lost its septic tank and been deemed unsafe for habitation — was $260,000.

Video taken of a Rodanthe, N.C. home in Sept. 2023 and Nov. 2021 shows encroaching tides completely surround the house. (Video: Erick Saks)

“There was an opportunity to get out, and I thought I should take it,” said Daniel Kerlakian, 36, of Cincinnati, who bought 23298 E. Beacon Rd. for $380,000 two summers ago, both as a rental investment but also a place to vacation with his wife and three young sons in a area they had grown to love.

Kerlakian had to move the home’s septic tank to a more protected area, and was able to keep renting the home almost until the sale. But given the ongoing erosion, the reality that no beach nourishment was planned and the uncertainties of what lay ahead, he decided it wasn’t worth it to stay.

“Why continue the stress? Why continue this battle with the ocean?” said Kerlakian, who said he basically broke even, but walked away with a mixture of relief and sadness.

Next door, Erick Saks received $100,000 less than his family paid in 2021 for 23292 E. Beacon Rd., when he and his wife bought the vacation home they christened “Mermaid’s Kiss.” A retired Air Force lieutenant colonel, Saks and his wife had gotten married in the Outer Banks, and he had cherished memories of past trips there. They had hoped to rent out the house but also have it as a place they and their two young children could forge their own Outer Banks memories.

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“We understood we were taking a risk,” Saks, who runs a Florida nonprofit he founded to help veterans who need housing assistance, said in an interview. Still, the home had stood since the mid-1980s, he reckoned, and when they bought it, there was far more beach than there would be only months later.

Saks said he replaced the roof and spent tens of thousands of dollars to repair a washed out septic system, only to have it immediately wash out again. His family was able to stay in the house only a couple of times, and to rent it out on only a handful of occasions. He considered trying to buy a nearby lot and move the house, but concluded he had sunk too much money into a troubled investment.

When the offer from the Park Service came along, Saks jumped at the chance.

He knew that holding on might only have meant mounting losses. And if the home fell into the sea, not only would he be on the hook for the cleanup, but it would pollute the beach he reveres.

“While this decision came with a significant financial loss and a heavy heart,” Saks wrote in a post on a local Facebook group, “we believe it’s a step in the right direction for the environment we’re so passionate about protecting.”

Thinking about the two tumultuous years he owned the Mermaid’s Kiss, he felt a measure of peace to no longer own a house that was a financial and emotional drain almost from the start.

“There’s definite relief,” he said. “This is something I had been holding onto.”

Even now, he marvels at how quickly the sea began to claim the house, how relentless the erosion has been. He can’t help but wonder what lies ahead for other homeowners, both in Rodanthe and up and down the coastline.

“We’ve been talking about climate change and rising sea levels forever. I always expected it would be something my kids’ kids would have to deal with,” he said. “I thought we had more time.”

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