Reader Question: Rotting from the Inside on Day One?

A reader emailed me an interesting observation/question in response to yesterday’s discussion of Seattle’s cheap, ugly townhomes.

3006 NE 55th St Seattle, WA 98105There’s a trio of townhouses very near where I live. They’re interesting because they lay partially framed for (if I’m recalling correctly) more than a year and a half — at least through one Winter/Spring.

3006 NE 55th St Seattle, WA 98105They actually have an entry on Zillow still. It appears to be out of date, however, since someone has purchased them and finished them up.

I drive/bike by these houses almost every day. I’m almost certain that the work just proceeded right from where it left off over a year ago. Now they look like perfectly respectable (ugly) townhomes, but I can’t see how they won’t start spouting mold and mildew almost immediately.

Do sellers have to disclose this sort of thing? Is my worry unfounded?

I’m not a construction expert, so I can’t say for sure whether leaving framing exposed to the weather through the winter is the kind of thing that can just dry out without causing problems down the road. It certainly seems like the kind of thing that might lead to trouble. Certainly if I were a potential buyer I’d want to know about it.

Is there a rule that sellers must disclose construction delays? Probably not. This seems likely to be a problem with a lot of construction that was started right as the bubble burst, and contributes to the concerns I have about how long these eyesores will really last.

It will be really interesting to watch the price trends of these kinds of homes over the coming years compared to similarly-sized single-family homes built in the same neighborhoods around the same time. I suspect that time will be considerably unkind to the value of these sorts of townhomes.

  

About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.

17 comments:

  1. 1
    Grant says:

    Shouldn’t have a mold problem if everything was dried out enough when insulation and drywall went up–bigger concern would be water damage like swelling/delamininating of the sheathing. I’d certainly want to know how long it was exposed to the weather…

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  2. 2
    redmondjp says:

    I’ve seen a number of unfinished houses (sheathed with chipboard, yuck) like this that have sat out in the weather for some time and I would never buy one. I’ve got scrap pieces of that chipboard or OSB in my back yard that are mostly protected from the rain and they still have black mold all over them.

    Several years ago while vacationing over on the Big Island of Hawaii I observed many new homes going up (this was before the housing crash). Their building code must require plywood for the exterior and roof sheathing, as that’s all they used – no OSB in sight. That’s one good thing about my otherwise-crappy 1970s rambler – it wasn’t built with any pressboard or OSB in it (or plastic water pipes, or chinese drywall, or LP siding).

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  3. 3
    3rd Generation says:

    Maybe these units will turn out like the healthy, wholesome McDonalds “food” below.

    http://www.youtube.com/watch?v=22ppFd1m_L8&feature=related

    Buy a Happy Meal (or codo) today. Yummmm.

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  4. 4
    Still Anonymous says:

    We have these 10-foot wide shoeboxes down here in Portland, too. Soulless, built for about $50, and there is precious little room to intersperse newly-planted trees etc. after bulldozing to build. In fact we used to rent one…when we drive past the development now, there is Tyvek wrapped around several units. Apparently some heavy-duty repair work is needed, for a <7 years old townhome development. It's frightening to think people were conned into paying large sums of money for junk.

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  5. 5
    ARDELL says:

    RE: 3rd Generation @ 3
    Pretty sure all three of those sold some time ago, and one is now back on market as a resale.

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  6. 6
    Peter Witting says:

    Look at things now!

    http://www.redfin.com/WA/Seattle/3006-NE-55th-St-98105/home/312714

    At least they have stainless appliances! The old growth trees are in the cemetary, of course, but at least graveyards are peaceful to look out on.

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  7. 7
    David Losh says:

    RE: Peter Witting @ 6

    These are an exception to the rule of town homes. These units are way over built. The guy who started the project did most of the work in constructing. It has heavy beams, solid wood framing, and a ton of concrete that exceeds code. When he went bankrupt a couple of yahoos came in with the OSB, but were stopped for the poor quality of work.

    I think FDIC directly took the property back. I talked with some official there who was concerned about the contractors, and was reading them the riot act. The inside was left kind of untouched.

    I haven’t been in since they were finished, but know the project is solid except for the sheathing, that should have been removed.

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  8. 8
    Jonness says:

    My next door neighbor completed a 4500 sq ft home in 2007. It took him about 18 months to build it, and it sat partly through the winter with the OSB up but no roofing. A few months later, I noticed black mold in the basement OSB trusses going across the ceiling. After that, the neighbor framed it all in and finished the basement.

    The bank repossessed the home about a month ago, so I walked over and checked it out. When I went in the basement, it had a harsh mildew smell. I suspect a lot of homes in the PacNW that sit with the OSB exposed in the rain prior to the roofing being put on on end up with some black mold being framed in.

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  9. 9
    Ray Pepper says:

    Welcome to Nevada! Homes lay stricken in these stages everywhere outside Reno and we are going on 4 years now!

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  10. 10

    RE: Ray Pepper @ 9 – Is Nevada for houses like Arizona is for airplanes? Can half-finished houses sit there indefinitely without effect from the weather?

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  11. 11
    Dewams says:

    Peter & David,
    Living in the area, I kept an eye on these. They spent one winter with only two of their three stories framed. At that point the developer had gone bust and the bank owned them. They spent another winter with the third story and roof, but not enclosed. At that point the bank had decided to finish them. Then the bank went bust, so the FDIC ended up with them and construction stopped. An investor bought them and completed them per the original ‘luxury’ plan. Given the market, I didn’t (and don’t) see how that could pencil out. I think they started out with an asking price around $550k and the price has dropped once so far.

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  12. 12
    Ray Pepper says:

    RE: Kary L. Krismer @ 10

    Kary, everytime I go home I find a fascination to get outta the car and go look at all these. I will take some pics next time and show you. Last time I looked there were LOTS of birds and nests inside and vandalism..All the windows seem to be broken and LOTS of dirt/dust piled in the homes…

    The very dry weather MUST be better on all the wood then the moisture we have here.

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  13. 13
    Suitably Skeptical says:

    My biggest question about these townhomes….how can they sell for more per square foot than existing homes in the same neighborhood? I mean, they must be infusing some kind of intoxicating herb into the moldy OSB -

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  14. 14
    Stu says:

    #13.

    Good question.

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  15. 15
  16. 16
    James Barnett says:

    I’m not one to be overly worried about black mold in this instance. I do worry about the strength of the sheathing. Sheathing is placed on homes to prevent earthquake damage. It is at least as important as earthquake straps and bolts. When OSB sits exposed to weather for one wet season, (even though this is almost certainly “weather-resistant” osb), it begins to fall apart, and expand, and the nail heads holding it to the framing are now in the middle of the osb instead of snug to the outside edge. Many framers overdrive these nails to begin with! Plywood will last a little longer exposed to the elements, but the real key is to get the roof on and at the very least, the sheathing wrapped.

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  17. 17
    redmondjp says:

    I love the smell of wet OSB in the morning! Let the rainy season begin . . . got Tyvek?

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