help doing a remodel correctly

Our downstairs has been gutted due to 3' of flooding from hurricane Sandy. The sheetrock was removed 4' from floor...plywood floors will be removed after drying out period. I want to put hardi board down (tile man told me..I know NOTHING) I know 3/4 exterior plywood, then all that is necessary to get level floor so hardi can be installed. I like the thought of this being able to withstand any water contact. But what about the 4' of sheetrock that must be replaced. Can hardi board go there? I like my builder and I think the tile people do the right thing. I just want it done correctly and am trying to educate myself so I don't have to completely trust others to do the right/best thing for me.

Hardie isn't affected by moisture, but the subflooring it is attached to is likely to be - your floor won't be waterproof and moisture will get in both through it and around it. When the goal is to install tile, the subfloor must be exposure 1 or exterior rated glue AND (and this is critical), it must have no content lower than a C grade (D has open, unfilled knots and is unsuitable for underlayment for tile). The cbu (Hardie is a brand of generic cbu) must then be installed with thinset and the proper anchors (this is either hot dipped galvanized roofing nails, not the electroplated ones, or the special cbu screws) at the proper intervals. Note, the seams on the cbu must then be reinforced by applying the proper (alkali resistant) mesh tape, embedded in thinset. This locks the sheets together. There are other considerations, and you might want to read and have available the manufacturer's instruction sheet for the installer. In your market, there will be lots of people trying to do lots of jobs as quickly as possible. It is IMPERATIVE that it be done per the manufacturer's instructions - DO NOT TAKE THEIR WORD THAT THAT IS THE WAY THEY ALWAYS DO IT, if it differs from the specs. You may want to have the following in your contract (or something similar) "All work is to be performed per the manufacturers' instructions and in accordance with accepted industry standards per the TCNA (for tilework)". Also, there's no reason to use anything thicker than 1/4" cbu on the floor unless you are trying to achieve a particular height where a thicker version might be useful...it is NOT a factor in floor strength - it is there for compatibility for the tile. And, if you're thinking about a natural stone tile, you need TWO layers of ply and twice as stiff joists than what is required for ceramic tile. Don't expect to be able to use thinset while installing the cbu to achieve a flatter floor - it will bend to match the subflooring if you embed the fasteners properly.

While you could install it on the walls, you'd still probably want to take it off to let the studs dry out and you'd need access to replace the insulation.

Because of the texture on Hardie, it can be difficult to get the surface to match drywall, and, the 1/2" stuff isn't really 1/2" thick, which poses a problem. Then, while it can be purchased in 4x8 sheets, they're hard to find, VERY heavy, and difficult to work with. For those reasons, I'd not use them for general purposes on a wall. In a shower, certainly (and smaller sheets are more common - 3x5').

Personally, I'd probably use something like Ditra from www.schluter.com instead of Hardie on the floors. Hardie is a good product, but cutting it should be done outside as the dust contains silica, which, if inhaled is carcinogenic. You can snap it like drywall, but it takes practice, and still produces a little dust, plus, the snapped edges aren't as straight (plus, taking off a small strip can be a major pain!).

It's a bigger repair, but something worth considering: Raise the house 4-6' to get the floor above the high-tide mark.

Then rebuild the interior as if it isn't likely to flood again.

I realize this may not always be practical and may have aesthetic & code issues working against it, but it's not as if the sea level in NJ is dropping, or that hurricanes are becoming lower in frequency or intensity.