Defective Drywall, or Chinese Drywall as it is often called, was a real problem in the late stages of the building boom and still remains an issue today if you are not careful.
Where did defective drywall come from?
2004 saw the Gulf Coast get hammered with several hurricanes only to be followed in 2005 by Hurricane Wilma. These hurricanes coincided with the building boom which caused American drywall suppliers to run short on supply. In order to keep up with demand, suppliers started shipping in drywall from overseas, particularly China. Unfortunately, much of this drywall contained hazardous sulfuric compounds that would leach out of the drywall causing severe health problems for humans and pets and great damage to wiring, plumbing, and other metal items in homes.
Why does the problem persist after the drywall is removed?
Concrete, being a porous substance, would absorb much of those compounds. Even after the defective drywall was stripped out of a property and replaced, the compounds would leach back out of the concrete if the property was not mitigated properly. In most jurisdictions, a seller must disclose to buyers that a home once had defective drywall, so even if a property has been remediated properly, resale could be impacted. That being said, many investors are able to acquire homes that once had defective drywall for less because of the stigma that goes along with such a property, but they would still have disclosure requirements to adhere to if they wanted to sell the property or, in many cases, if they were renting it.
What should a buyer ask about a home built around 2006?
Be very wary and ask questions regarding homes built around 2006. You might just be walking into an unknown problem.
Castle Rock Capital Funding is a Florida licensed mortgage brokerage. See our Consumer Loans page, or start your application.