Environmental Risks, You Ask?

(Friday, July 07, 2006) - It's routine by now for buyers to hire inspectors to examine the home they plan to buy, but growing numbers of buyers are also seeking information on possible environmental risks nearby. Until recently, it was mostly commercial property buyers who sought such information, or home sellers required by state laws to disclose it. But some home inspectors and providers of environmental reports are banking on increasing demand from residential buyers nationwide who are already seeking information about crime, the neighborhood and local schools.

"Consumers just have an insatiable appetite for more and more information at the time they're buying a home," says Robert Barber, CEO of Environmental Data Resources, which has hooked up with the home inspection franchise Pillar to Post to provide this kind of information to home buyers for a fee of $130. "We started seeing an enormous spike in requests for information." Barber says that at least 10 states in the last year have introduced new laws that require home sellers to disclose some environmental data to buyers, such as immediate proximity to a hazardous waste site, or a former gas station or dry cleaner.

Barber says the reports are based on searches of federal, state and local databases that list environmental hazards located within 300 feet of a residential property. More than 90% of the time the reports provide good news: no environmental hazards nearby. "We anticipate it's just a matter of time before environmental information is part of every residential property transaction in the country," he says.

Maybe, but it's often sellers who pay for it. In California, for instance, buyers don't have to ask because sellers must disclose environmental information, and their agents hire companies such as EDR or Property I.D. to produce the report. "It's only one in a thousand (buyers) who ask for an environmental report," says Nick Gromicko, founder of the National Association of Certified Home Inspectors. But that's still more than 10 years ago.

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