Buyer beware: Chinese drywall showing up in foreclosed homes now for sale

For the first time, we're starting to see homes that are known to have toxic Chinese drywall put up for sale.

A never-lived-in, four bedroom, two bath home in Northwest Cape Coral is selling for a steal -- just $19,800. But buyer beware: the low sticker price is because the home is infected with Chinese drywall. Still, people are interested.

"We are probably experiencing anywhere between 10-15 calls a day in addition to email leads inquiring about property with Chinese drywall," Realtor Jennifer Pentico says.

An out-of-town investor has a contract on this house.

"A lot of these consumers don't know the ramifications of Chinese Drywall and what it's potentially going to take to remediate something like this," Pentico says.

Pentico encourages buyers to hire an inspector and sign off on knowing Chinese drywall is in their new home. David Schwartz and Val Salerno bought a foreclosure to be closer to family. They heeded the warnings.

"While we were down here on vacation it was all over the news about Chinese drywall, so we said to the builder, 'you would know if we had Chinese drywall in the house, wouldn't you?' And he said 'oh yeah, you don't have Chinese drywall'," Salerno says.

Yet all of the signs and symptoms are there.

"All of these are supposed to be copper fittings and they're black," Schwartz says of the copper fittings on his air conditioning coil.

WINK News obtained a copy of the home's inspection. It makes no mention of any problems related to Chinese drywall.

Now Realtors fear as homes come up for sale, unwitting new owners might find themselves in a similar situation.

"We're taking the proactive approach to make it public knowledge that it has Chinese drywall," Pentico says. "That way any appraiser or real estate transaction going forward is going to know at one point, this property was affected with Chinese drywall."

Lenders and insurance agents tell WINK News it's difficult to get a loan or coverage if you know the home you are purchasing already has Chinese drywall. They say it's a pre-existing damage that's not worth covering.

Some worry what Chinese drywall home sales are doing to property values. For example, the home selling for less than $20,000 might otherwise sell for around $70,000 if it did not have the toxic wallboard. Re/Max Realtors tell WINK News they'll essentially black-list properties known to have the toxic board so agents and appraisers don't factor in the ultra-low sale figure.

About Safeguard
Safeguard Properties is the largest privately held field services company in the country. Located in Cleveland, Ohio and founded in 1990 by Robert Klein, Safeguard has grown from a regional preservation company with a few employees and a handful of contractors performing services in the Midwest, to a national company with over 700 employees. Safeguard is supported by a nationwide network of subcontractors able to perform any requested superintendence, preservation, and maintenance functions, as well as numerous ancillary services in the U.S., the Virgin Islands, and Puerto Rico.