So What Do You Do with a Smelly Orlando House?

Imagine buying your Orlando dream home and experiencing a string of problems with it before you've even written the first few mortgage checks. The house has a funny smell and your wife and kids have had headaches and nosebleeds ever since you moved in. After you've lived there awhile you notice that the copper pipes, electrical wiring, and air conditioners are corroding as well as your microwave, phones, & computers. You fear that the drywall could be a fire hazard.

Imagine being a builder in the midst of one of the worst times in recent history for new home construction. You had built a few hundred homes in Florida just as Hurricane Katrina rebuilding was in high gear, and drywall supplies were short, so you used Chinese drywall to finish the job. Now, a couple years later, complaints are flowing in about peculiar things happening in the homes. Your inspections find that the wall board used in the home could be causing the problem, so you sue a major foreign supplier along with drywall suppliers and installers. Choosing to be pro-active in fielding customer complaints, you set aside $40 million to fix the 400 homes involved. Your action solicits a similar response for some other builders, but not all.

The scenarios described above are real life horror stories for builders and homeowners throughout the U.S. Some 500 million pounds of Chinese drywall was imported and installed in 100,000 homes between 2006-2007. Half to two thirds of the supply was used in Florida, but consumers from 23 states have complained to the Consumer Product Safety Commission, which set up a Drywall Information Center. Fixing the problem - replacing the drywall and the corroded systems - is expected to run over $100,000 per home. These figures might not include any additional costs for the homeowners to paint or wallpaper the wall surfaces or for other personal property destroyed by the chemicals in the drywall, or for health care for drywall-induced illnesses.

The Environmental Protection Agency (EPA), U.S. Consumer Product Safety Commission (CPSC) and the Florida Department of Health (FLDOH) are all testing samples of the drywall to discern the dangers it poses. No one questions that the homes smell but the issue at hand is whether the drywall is poses a verifiable health hazard or other safety risk. On August 22, the CSPS and FLDH released a report that declared the drywall did not emit dangers levels of radioactivity.

Knauf Plasterboard Tianjin, the manufacturer named in the lawsuit by builder Lennar Corp., concedes that its drywall emits carbon disulfate and carbonyl sulfide, but not as levels that could harm health. They say the health complaint are "non-specific" and could be caused by a number of things. FLDOH and CPSC tests are evaluating these claims while pondering the question of whether it is safe for people to stay there in the meantime.

Attorneys for Knauf have conceded that the sulfate gasses emitted do corrode metal but do not pose a fire hazard. They have ruled out their method of extracting gypsum for the wallboard in the manufacturing process and have localized the smelly drywall. They believe that one mine in Shandong Province produces a foul smelling off-color gypsum used on some product. The CPSC is trying to figure out why this drywall is emitting more sulfur-compound gases that domestic drywall

Knauf supplied only 20% of the drywall shipped in the U.S. between 2004-2007, but did not ship any after October, 2006. They are examining ways to remedy the problem without tearing out all the drywall. Regardless of what they come up with as a way to make things right for their customers, that leaves the responsibility for fixing the other 80%.

As the testing continues and the lawsuits pile up, consumers wait. Even if all the testing somehow determines that the drywall does not pose a health or safety issue, the homes still smell. No one want a pricey home that smells like a sewer. Hence, our final scenario:

Imagine owning a home that smells, causes respiratory distress, and cannibalizes the systems that make your home function - regardless of what the government tests conclude. You want to sell in a market that is already problematic, either to get away from this home or because you've been transferred out of state. You're already prepared to take a beating on your $320,000 home due to the market, but your online research indicates that if you disclose the problems in the home (a legal and moral requirement), the value could drop to $20,000. Your builder won't help you, your homeowners' insurance doesn't cover construction defects, you can't afford to get the house stripped of bad drywall and replace corroded systems or relocate while the home is renovated. You are strongly tempted to walk away from the home mortgage...

The way this drama plays out will have a big impact on the housing market in Florida and throughout the country. Stay tuned for updates from Janice Petteway. In the mean time, want to make sure the home you buy is free of Chinese drywall problems? Call Janice at Exit Real Estate Results for trouble-free Central Florida homes.