Buying property that was literally a dump

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Dear Real Estate Adviser,
Is it a bad idea to buy a house that was built on a former dump? What should we take into consideration when looking at these types of houses?
— Debbie Dump

Dear Debbie,
It all kind of depends on what was dumped there, how well it was sealed, or “capped,” and how long ago it was a landfill site. Obviously, a developer has to do significant remediation to rework a dump site into residential land these days and have it declared safe by the city and/or the Environmental Protection Agency. But how much remediation is enough? That’s a matter of debate.

I should note that many parks, golf courses, malls and even college campuses have been built atop old landfills with little or no problems. In general, that’s because landfill sites built after the mid-1980s were designed, at least in theory, to prevent significant environmental soil contamination. Older dump sites are bigger risks.

Environmental remediation of dumps seems to be an inexact science. There are former dump sites today where residents routinely notice recurring odors or see old tires and glass popping up out of the land, though the refuse was supposed to be walled off. Heavy rains have been known to bring out unpleasant odors at such sites. Sometimes, groundwater tests find levels of contaminants just below the unsafe threshold. Even sinkholes can appear for a variety of reasons, such as the land settling, or arsenic and other chemicals eating away at organic materials below the surface.

Moreover, some tests and news investigations conducted in the U.S and Europe over the past 20 years have found a disproportionate number of cases of asthma and cancer in housing developments built over landfills, particularly where large amounts of chemically laden industrial waste were buried. I am curious if there are monitoring wells on the residential land you’re looking at, which will test for the presence of methane gas, ammonia or excess levels of carbon dioxide. You should find out.

Because you obviously were notified the place was built on a dump, there is no seller disclosure issue to deal with here. Of course, you will have to disclose that old dump site to a potential buyer when it’s your turn to sell. How comfortable are you with that?

By the way, any former contaminated dump site, including Superfund hazardous waste sites, must still meet local and state remediation standards for home purchasers to qualify for loans backed by the Federal Housing Administration. In fact, the EPA recommends that prospective purchasers contact their EPA regional office to discuss site-related issues before trying to buy such a house and secure funding. The agency can issue a status letter for prospective buyers and their lenders that will detail the site’s status, cleanup actions and any ongoing liability issues.

Sorry to all you developers and redevelopers of landfills out there, but I must advise Debbie and others to avoid buying homes on former dump sites unless they’re certifiably sure all risks have been identified and mitigated permanently. Even then — well, it just takes one scare story, valid or not, to do significant property-value damage.

Good luck.

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