A house in Union Beach, N.J., after Sandy

Hurricane Sandy floored me. Its overpowering storm surge flooded my home on the Jersey shore. So I went to my local Federal Emergency Management Agency (FEMA) Disaster Recovery center looking for help.

First, a sweet, middle-aged woman gave me lots of information and pamphlets on "retrofitting" my waterlogged home. Then the FEMA lady dropped a bombshell. "We may tell you that you can no longer live in your home," she said. "You should check with your local municipal building office."

Trick or treat

On the eve of Mischief Night, Superstorm Sandy, the second most expensive storm in U.S. history, cut a huge swath through the New Jersey coastline, as well as flooding low lying areas of Brooklyn, Queens, Manhattan and Staten Island. It sent residents of the heavily populated East Coast begging for help from FEMA.

The FEMA-run National Flood Insurance program (NFIP) is handing out billions of dollars to the coastal residents who had flood insurance -- even though the NFIP is already $18 billion in debt. Bills that will provide $60 billion more in flood relief have already passed the House of Representatives and Senate and will now go to the President for a certain signature.

Day of reckoning

So the day of reckoning is at hand and here's what will happen. FEMA holds sway over every municipality that is anywhere near water. It can either provide or withhold flood insurance, based on what a municipality does or doesn't do to protect itself against the next deluge. But without flood insurance banks won't finance new construction.

So the NFIP money that you receive to rebuild can count against you. According to my local municipal building department, if your contractor spends more than 49 percent of the assessed value of your home, then the building inspector makes you tear it down and rebuild. Translation: Raise the house on pylons or install a concrete basement that raises the living space above the flood plain.

There's also another alternative, according to our governor, Chris Christie. If you don't want to spend tens of thousands of dollars to raise your house now, you can pay exorbitant premiums of up to $31,000 a year for flood insurance later, he said at a recent news conference in Seaside Heights. "There's going to have to be some hard decisions made," Christie said.

How high is high enough?

Since the flood plain maps are being redrawn, it's not clear how high up you would have to build. Sandy and other recent storms have shown that the old maps were inadequate. According to those maps, my house was just half a foot below the flood plain. But it filled up with two feet of water.

And if you live in a severely damaged home, you may not own that home much longer. As the sweet FEMA lady told me, "We may tear it down and turn it into parkland." Don't worry, you'll receive compensation, but is it enough to justify your loss?

Mass migration

If you think that this scenario is improbable, consider that The New York Times recently ran an op-ed piece that endorsed the idea of a mass migration from flood-prone areas like the East Coast.

"Congress and the president should...make some tough decisions...like [encouraging] people to move out of the most disaster-prone areas," say Judith Kudlow and Jason Scorse. And their opinion is shared by other policy wonks like the R Street Institute.

Of course no one is advocating that the world's financial center move out of Manhattan, no matter how many times it could flood. They'll spend billions -- maybe even trillions --to make it safer.

But my shore house, built on a slab and with a low assessment, is easy pickings. If I even try to rebuild extensively, I'll just have to tear it down, dig out the slab, put in a new foundation and build a brand new expensive home.

Currier & Ives

This suits everyone's purpose but mine. The township makes more money because it will tax my brand new and bigger home at a higher rate. The local builders and bankers make money from the job. And FEMA will stem the bleeding from its money-losing flood insurance program.

So is this the end of the quaint oceanfront and bay cottages that once dotted the Jersey shoreline, now to be replaced by millionaires' mansions? Don't worry. You'll still see them in those old Currier & Ives lithographs.