Balancing Home Disclosure Goals

Today’s New York Times has a tragic story detailing the various health (and financial) calamities that befell one Tennessee family after they unwittingly bought a home that had formerly been used as a meth lab.

As recent Minnesota home buyers and sellers can attest, Minnesota requires Sellers to disclose whether their home had ever been used to make meth.

While my general stance is, “the more disclosure, the better,” the meth disclosure seems questionable, for three reasons.

One. If you turned your home into a meth lab . . . . you’re probably going to lie about it (and many, many other things) on the Seller’s disclosure.

That’s why Buyers should never waive having their own *inspector check out the home they’re negotiating to buy.

Two. Little chance of financial recovery.

If a home Seller lied about a material defect — and the Buyer can prove it — they have grounds for a lawsuit. The ultimate goal of such a suit would be a claim for damages, or some other judgment against the Seller.

Meth lab proprietors typically don’t have assets. Nor do they have homes (any more). They’re usually what lawyers call “judgment proof.”

So sticking them with liability for remediating meth contamination isn’t going to do anything for the Buyer.

Picking Your Battles

Three. A very small sliver of the nation’s housing stock is afflicted with meth-related contamination — less than .02% of the nation’s single family homes, or 2 in 1,000.

Even that number arguably exaggerates the risk. According to the article, the problem is concentrated in the South and West, and even there, is primarily in rural areas (it’s hard to have a clandestine meth lab in an apartment building).

Given the horrific consequences of meth exposure, even a minute risk might warrant making the real estate buying public aware.

However, that goal needs to be balanced against another, practical consideration that’s as or more important.

Namely, if you make the Seller’s disclosure sufficiently long — which is probably already the case — no one will pay attention to any of it.

*As part of a home buyer’s inspection, I always recommend talking to at least one neighbor to get the “scoop” on the house, block, etc. In the NYT article, the home’s meth lab status apparently was known to the entire neighborhood.

About the author

Ross Kaplan has 19+ years experience selling real estate all over the Twin Cities. He is also a 12-time consecutive "Super Real Estate Agent," as determined by Mpls. - St. Paul Magazine and Twin Cities Business Magazine. Prior to becoming a Realtor, Ross was an attorney (corporate law), CPA, and entrepreneur. He holds an economics degree from Stanford.

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