As a real estate broker, I ask myself the same question. What I have learned about the mindset of some people is that they just don't believe a destructive flood will happen to them.
Homes in flood prone areas are usually less expensive. Builders purchase the land so cheaply that they can afford to build and sell below general market prices. Sellers want to sell, and while they must disclose that the home is in a flood zone area, sales agents tend to downplay this negative aspect of the location. While looking for a home for myself in southern California, I heard one agent say, "Oh, we haven't had a major flood in this area in two decades." People rely on salespeople. Luckily, I didn't buy in that area, because two years later, I read about a major flood that could have been my home.
Buyers have such a desire to buy a home of their own, they tend to ignore certain facts. A lot of times, people rely on official warnings that will allow them time to get out of harm's way. People generally don't think the flood is going to be as bad as it could be. I had clients who moved to California from New Orleans. What they told me was that they never thought the flood would be as bad as it was. They expect floods each year, but they never expect it to be so bad that they can't recover.
If a major flood has occured in an area, people tend to have peace of mind that a flood of the same magnitude is not likely to happen again soon. It's a mindset. They believe that after major disasters, the city puts measures in place to "assure" that the people are protected from such future disasters.