By Robert Irwin
Question: I am in the process of buying a home and the inspection report has revealed that there are beams covered with black mold in the crawlspace under the house. I called in two fungus-removal companies and both say it should be removed -- at a cost of around $12,000!
The owner says the black mold was on the boards before the house was built (he had it built himself) and says it hasn't grown in the 17 years he has owned the house. He also says he has never had a health problem because of it. He is unwilling to pay anything to have the mold removed. Should I not worry and continue with the purchase, or should I back out of the deal?
-- Holli, San Antonio
Holli: As you have probably surmised, black mold is the latest horror story to crop into real-estate transactions. Five years ago almost no one had heard of it. Today, every house seems to have it. While there are questions over the severity of black mold as a health issue, at this point it is clear that it has become a serious economic issue. There have been lawsuits over it, inhabitants of homes with it have demanded that their insurance companies remove it and some homes, apparently, have even been destroyed to get rid of it. The big questions are: Is it a serious health hazard? And should it affect the purchase of a home?
As far as health is concerned, a recent booklet from the U.S. Environmental Protection Agency, "A Brief Guide to Mold, Moisture, and Your Home," says:
"Molds are usually not a problem indoors, unless mold spores land on a wet or damp spot and begin growing. Molds have the potential to cause health problems. Molds produce allergens (substances that can cause allergic reactions), irritants, and in some cases, potentially toxic substances (mycotoxins)."
The federal Centers for Disease Control and Prevention and many states are currently conducting tests on black mold in the home to determine if it poses a true health hazard. Until the results of these studies are in, people probably won't know for sure what they are up against.
On the other hand, there is a kind of hysteria about black mold today among home buyers. Many people won't go near a house that they know has black mold in it. This means that homes with black mold will either need to be cleaned before being placed on the market or face the prospect of offers that may not meet expectations.
As far as your situation is concerned, you may feel perfectly at ease buying a home with black mold, and you may very possibly live in it without health problems, as the seller claims to have done. However, when you go to sell, you will have the same problem that the current seller has: You might have to remove the black mold to keep from having trouble finding a buyer.
Therefore, my suggestion is that you prepare to foot the cost for removing the mold at some point along the line (it is unlikely to disappear on its own) or get the owner to pay for removal -- or at least reduce the price accordingly. You also could pass on the property and let someone else deal with the headache.
For those with long memories, a decade ago a similar problem cropped up with high-tension electrical wires above homes. There were reports that the wires caused everything from heart disease to cancer. Although the subsequent studies I have seen failed to link the wires to specific health problems, even today the value of homes near high-tension wires tends to be diminished because of them. This is a lesson worth remembering.
-- Mr. Irwin has more than 25 years' experience as a Los Angeles-area real-estate broker. He is the author of more than two dozen books about real estate and is recognized as one of the most knowledgeable writers in the real-estate field. Mr. Irwin's most recent books are "How to Get Started in Real Estate Investing" and "How to Buy a Home When You Can't Afford It" (McGraw-Hill, 2002).
