Are Investers Flipping Chinese Drywall Homes? (Cape Coral, Port Charlotte: bank owned, real estate, foreclosure)

[tommy-105]

I know there is a thread on CDW already on the Cape Coral - Ft Myers forum, but this forum has three or four real estate agents that are on here all the time who might be able to answer my question.

I spotted a couple of smaller homes in a small Port Charlotte neighborhood a couple of weeks ago that had their interiors totally gutted. New metal stud framing had been put in, and it looked like new wiring was going in as well. I did not see any building permits. It looked like the same crew was working on both homes. There wasn't any dumpster on site and the only evidence work was going on was the porta-pottys out front.

I haven't looked them up on the county appraiser's site yet but I suspect they are the right age for CDW and that the same investor owns both properties.

I was wondering how the owner could get around disclosing the CDW when he goes to sell them.

Today I see this in a Naples Daily News story about investors buying up CDW properties:"Knight said buyers of remediated homes should be cautious. There is no requirement to prove the home is free of Chinese drywall. The industry is trying to avoid required disclosure because not all Chinese-manufactured product is faulty, he added."

I thought owners had to disclose if they knew they had a problem. Does this mean that if they remove "the Problem" (the drywall) they don't have to disclose that the home once had CDW in it ??? That's nuts!

House smells due to Chinese drywall? Not a problem, say some investors » Naples Daily News

[Big House]

Originally Posted by tommy-105

I know there is a thread on CDW already on the Cape Coral - Ft Myers forum, but this forum has three or four real estate agents that are on here all the time who might be able to answer my question.

I spotted a couple of smaller homes in a small Port Charlotte neighborhood a couple of weeks ago that had their interiors totally gutted. New metal stud framing had been put in, and it looked like new wiring was going in as well. I did not see any building permits. It looked like the same crew was working on both homes. There wasn't any dumpster on site and the only evidence work was going on was the porta-pottys out front.

I haven't looked them up on the county appraiser's site yet but I suspect they are the right age for CDW and that the same investor owns both properties.

I was wondering how the owner could get around disclosing the CDW when he goes to sell them.

Today I see this in a Naples Daily News story about investors buying up CDW properties:"Knight said buyers of remediated homes should be cautious. There is no requirement to prove the home is free of Chinese drywall. The industry is trying to avoid required disclosure because not all Chinese-manufactured product is faulty, he added."

I thought owners had to disclose if they knew they had a problem. Does this mean that if they remove "the Problem" (the drywall) they don't have to disclose that the home once had CDW in it ??? That's nuts!

House smells due to Chinese drywall? Not a problem, say some investors » Naples Daily News

If they sell it "As-Is" then it is buyer beware, and no disclosure is necessary. If they disclose that it may have had chinese drywall, and they removed it, it would be truthful, but it may or may not alleviate all the other underlying concerns with having a home that at one time had chinese drywall in it. If they replaced all the metal studs and wiring, then they have greatly mitigated the issues related with having a home with chinese drywall.

If you read this, then read the thread on the Ft. Myers board, I did a pretty good job explaining most of the issues with Chinese Drywall. I haven't commented on it since, because I don't think it is necessary to say the same thing over and over and over again.

[kbuild]

Some individuals I know are now in the business of remediating CDW. I asked what guidelines they are following ( knowing there is none) Also asking about what safety precautions (breathing equipment, Haz-Mat suits) None. I also asked about sealing the duct work off? No. This new found trade has no guidelines very scary!

[mr&mrssunshine]

kbuild i returned your call,,,,

[tommy-105]

Originally Posted by Big House

If they sell it "As-Is" then it is buyer beware, and no disclosure is necessary. If they disclose that it may have had chinese drywall, and they removed it, it would be truthful, but it may or may not alleviate all the other underlying concerns with having a home that at one time had chinese drywall in it. If they replaced all the metal studs and wiring, then they have greatly mitigated the issues related with having a home with chinese drywall.

If you read this, then read the thread on the Ft. Myers board, I did a pretty good job explaining most of the issues with Chinese Drywall. I haven't commented on it since, because I don't think it is necessary to say the same thing over and over and over again.

So If what you're saying is true, (I had hoped to get an answer from a real estate agent, no offense) people buying "as is" can easily be buying a CWD home that will pass CWD inspections because the drywall and building components with visible damage have been replaced.

Originally Posted by kbuild

Some individuals I know are now in the business of remediating CDW. I asked what guidelines they are following ( knowing there is none) Also asking about what safety precautions (breathing equipment, Haz-Mat suits) None. I also asked about sealing the duct work off? No. This new found trade has no guidelines very scary!

Thanks, kbuild. Yes I agree it's very scary. I'm pretty sure you don't need to be in construction to realize how much dust is released into the air during any drywall demolition. That's why you mention the importance of sealing the duct work off during the demo. I'm concerned with the dust getting into the pores of the cement block and into any fiberglass insulation that isn't removed. Are they power washing the walls and floors after the demo phase? I don't think they can, because then I think the stuff becomes an acid and soaks into the concrete floor (that's just conjecture on my part of course).

There have also been reports of the rotting egg smell returning after "remediation" but the remediation companies seem to be saying that it isn't happening. The article I linked to says "About 30 homes disclosed to contain the noxious drywall sold in Lee County this year" That means 30 homes are out there in Lee county that were knowingly bought with the problem. I would be surprised if any of these buyers intend to live in these homes. The article also says "At least 1,000 Lee County homes were built with defective drywall." And that the trend of investors buying them up is expected to continue. Again very scary.

[SoFLGal]

Originally Posted by tommy-105

I know there is a thread on CDW already on the Cape Coral - Ft Myers forum, but this forum has three or four real estate agents that are on here all the time who might be able to answer my question.

I spotted a couple of smaller homes in a small Port Charlotte neighborhood a couple of weeks ago that had their interiors totally gutted. New metal stud framing had been put in, and it looked like new wiring was going in as well. I did not see any building permits. It looked like the same crew was working on both homes. There wasn't any dumpster on site and the only evidence work was going on was the porta-pottys out front.

I haven't looked them up on the county appraiser's site yet but I suspect they are the right age for CDW and that the same investor owns both properties.

I was wondering how the owner could get around disclosing the CDW when he goes to sell them.

Today I see this in a Naples Daily News story about investors buying up CDW properties:"Knight said buyers of remediated homes should be cautious. There is no requirement to prove the home is free of Chinese drywall. The industry is trying to avoid required disclosure because not all Chinese-manufactured product is faulty, he added."

I thought owners had to disclose if they knew they had a problem. Does this mean that if they remove "the Problem" (the drywall) they don't have to disclose that the home once had CDW in it ??? That's nuts!

House smells due to Chinese drywall? Not a problem, say some investors » Naples Daily News

Since you are soliciting a Realtors opinion on this matter I will give mine. According to court case Johnson vs. Davis an owner/investor/seller, Realtor, etc must disclose all known material defects to the home. If they don't they would/could be held liable. This is normally done in the form of a "sellers disclosure". Becasue a bank has never lived in the home and does not usually have any prior knowledge of issues you will not get one from the bank. All bank owned homes are sold "as-is". If a Realtor had any knowledge of CDW or any other defects this would have to be disclosed regardless of any sellers disclosure or not.

Here's where the problem lies. Say a home was owned by the owner and the owner knew the home had CDW. Then the home goes back to the bank in a foreclosure. The bank might have no knowledge of the CDW.

On the homes in Port Charlotte I wouldn't automatically assume CDW. Maybe the home never had drywall up or maybe it was ripped out because the elements got to it or possibly it had CDW. There's no way to know unless you spot definite signs of it.

I've been in homes that have had CDW and you would never know unless you looked at the evidence on the A/C coils, on the copper wiring, etc and I've been in CDW homes where the minute you walked in you could smell it and see the evidence of it.

I always recommend a good home inspector, even if the home is brand new and never lived in. It's a small investment for a little piece of mind.

[Big House]

Originally Posted by tommy-105

So If what you're saying is true, (I had hoped to get an answer from a real estate agent, no offense) people buying "as is" can easily be buying a CWD home that will pass CWD inspections because the drywall and building components with visible damage have been replaced.

The answer is if they buy it "AS-IS", it is thiers, and it won't matter whether or not it will pass a CWD test. And, it won't be required for the buyer to deal or worry about the work involved to rid the house of the myriad of issues related to the issues, or residual issues, of the house, if it had CDW, lead paint, or any other issue. The inspection is not incumbent on the seller. It is incumbent on the buyer to determine the extent and quality of the inspection, hire qualified inspectors, determine the extent of the testing and so forth.

There are a lot of factors such as those that K-build pointed out beside just the dust contamination. The corrosive effects will impact almost everything, including the nails and fasteners that are in the various framing systems. In the nails and trusse plates, in the reinforcing steel in the concrete and masonry. It is well documented that it is corroding the copper in the wiring, in the hvac coils, in the doors, door frames, hardware, resilient channels, aluminum, plumbing fixtures, kitchen cabinet hardware. The dust and out-gasing is harzardous to the health of people. No degree of safety as been determined with any of that yet.

So if a house had chinese drywall, it would have a negative effect on its value, and simply put, I wouldn't buy one.

[tommy-105]

Ok, thanks everyone. I think I got my answer. Seems like I was missing something obvious. (I can be dense sometimes) Here's the hypothetical scenario;

A bank has home that has been declared as having CDW.

An investor buys this home with full knowledge of the issue.

Investor re-mediates and sells home "as-is" to cover his butt.

Mrs Tommy points out that the "black mark" of being a CDW home when the bank had it will always follow the home in the records. In other words once a home is disclosed that's it. It will always be disclosed. So this would mean that an investor couldn't unload it on someone without them knowing about the problem.

[kbuild]

AS-IS that is the keyword....

[kbuild]

Interesting article on CDW from INTER-NACHI from whom I am a member of
Chinese Drywall - InterNACHI: home inspection/inspector