Malibu homeowners say FEMA rules could force them into demolition after Palisades Fire

Homeowners blame FEMA rules for recovery delays

Malibu homeowners are concerned about the regulations' financial burden and potential for community displacement.

LOS ANGELES COUNTY, Calif. - Real estate mogul Grant Cardone is speaking out against a FEMA regulation that may force him to demolish his Malibu beachside home. His home survived the devastating Palisades Fire but sustained heavy smoke damage. The rule, tied to flood elevation standards, could impact other homeowners along the coastline, raising concerns about affordability and community displacement.

Cardone’s home, located along Pacific Coast Highway, escaped the flames but now faces a new threat. According to a letter from an architect to Cardone’s team, FEMA regulations require that homes with repairs exceeding 50% of their value must comply with updated flood standards. For Cardone, this means elevating his entire property by about a foot, necessitating a complete teardown and rebuild.

"This is a perfect structure," Cardone said. "They want me to take all of that down. None of this was fire-damaged. I’ve never been threatened by water, never had a flood, never had any risk of water in my home."

The required demolition would escalate repair costs from an estimated $2 million to $50 million, Cardone said. "This is beyond insanity," he added. "It’s like someone intentionally wants to remove housing from the coastline."

Cardone is not alone. Other Malibu homeowners, including his 85-year-old neighbor, could face the financial burden.

"My neighbor, she’s not going to be able to afford to rebuild," Cardone said. "She’s not going to be able to afford the insurance."

Patrick Miller, a lifelong Malibu resident, also expressed frustration with FEMA, an organization meant to provide relief. Similar to Cardone, his home survived the fire but sustained smoke damage.

"I don’t see how FEMA, which is supposed to be charitable, is causing huge stress for someone," Miller said. "This may be the situation where we’re going to lose that community," he warned.

Cardone vows to fight the regulation, concerned not only for himself but for the broader community. "You have to be super rich now in America to survive this. The middle-class rich are being impacted like they’re poor people now."

FOX 11 reached out to FEMA for comment on the regulations and whether exemptions could be made but has not received a response.