In other zones (like A, AE, or VE) , yes, it is possible to make a request to FEMA to re-classify the lot or the house if the lowest adjacent grade is higher than the Base Flood Elevation. Without the letter from FEMA, you will typically pay the highest rates in Zone VE (which will be on the ocean in St. Johns County) and Zone A, and lower rates in Zone AE. If you are in one of those zones and have a mortgage, you will be required to buy flood insurance.
Regarding resale, if you have to buy flood insurance with a mortgage, that will be a turn-off for some buyers of course. If the first floor elevation of the house is lower than the Base Flood Elevation, then you will probably want to steer clear because the flood insurance is going to be very pricey.
Being in a flood zone doesn't have to be a big deal. It does depends on circumstances. My home is in a FEMA Zone X, which is the 500 year flood zone. But my home is on the Delaware river, so I've got a great view in the backyard and wate access rights. Would I actually choose to buy in a flood zone if I did not have a water view? A good question. I might, but I'd perhaps think it over a bit more.
Anyway so let's review FEMA Zone X, since that's my zone too. Essentially each year there is a 1/500 chance of flooding. For my area this is defined as water that would reach the house and then get perhaps only 1' high into my basement. I have no idea if homes in St. Augustine have basements though. Oh - and I did NOT have to pay any insurance premium either.
I would certainly recommend that you check the FEMA flood charts yourself to validate what is being told to you. Here they are:
Technically, this means that you should NOT be required to purchase flood insurance by your lender. I chose not to buy for mine but there isn't a whole lot in the basement that would possibly be effected. All the "valuable stuff" is a good 10 feet higher still than that. I also knew that the last three 100 year floods in my area never got to the house.
If you will have a water view and/or water access as a result - then to me, zone X is a reasonable compromise. If it was a 100 year flood zone (A or S) then I personally wouldn't be interested unless my home was raised.
I would not buy a house that was in a 300 year flood zone. Most people only talk about a 100 year flood zone.
Some people would buy in a flood zone, but insurance costs and floods happening would stop a lot of people. I would rather pay an extra $20k and not have the flooding.
Baird & Warner | Lincoln Park
Without having the exact location it is impossible to advise you. Flood zones are geographic areas that FEMA has defined according to the varying levels of flood risk.
A location defined a zone X is considered to be a moderate to low risk area.
Regardless of the level of risk associated with a location, if you are uncomfortable with it, you may want to consider other options and enjoy peace of mind.