Why? Is there shortage of other habitable land?
Also:
Much of the low risk land around there are privately owned ranches.
Demand for housing and business allow developers to acquire land for a small premium and sell rent structures for competitive market rates.
Overall, flooding is simply a known assumed hazard residents must endure.
Most insurance companies charge insanely high premiums for areas in risky flood zones. Obviously it’s going to be risky when you’re adjacent to a river
