Proximity to Sewer Treatment Plant and FHA

[dmckean]

I visited the property and noticed an offensive smell as soon as I got out of the car. Every time I came out of the house, the smell was there. Looked at the aerial map and the village sewer treatment is 750 feet away from the Subject. I notified the AMC who talked to the the Lender, Lender is leaving it up to me to decide if it's eligible. I think not, but want some input before I nix this one. (And should I even be the one nixing it? I thought the Lender made that call?)

 

[glenn walker]

C

I visited the property and noticed an offensive smell as soon as I got out of the car. Every time I came out of the house, the smell was there. Looked at the aerial map and the village sewer treatment is 750 feet away from the Subject. I notified the AMC who talked to the the Lender, Lender is leaving it up to me to decide if it's eligible. I think not, but want some input before I nix this one. (And should I even be the one nixing it? I thought the Lender made that call?)

Call your HOC but in general yes its eligible --we have one development that has over 500 homes adjacent one and basically as long as the treatment plant is permitted and signed off by EPA etc--The smell is not dangerious just offensive although people who live there said you get used to it. The same with homes close to the dairy .

I always look in the neighborhood to also see if other properties have FHA loans on them--NOW with that being said you don't determine if its eligible or not you just report what you observed and smelled - NOW the FHA DE Underwriter decides if its eligible. Personally as long as people live in that area I woudl not have a problem with it- As they say in car sales their is an-*** for every seat even a smelly one : )

 

[jay trotta]

I visited the property and noticed an offensive smell as soon as I got out of the car. Every time I came out of the house, the smell was there. Looked at the aerial map and the village sewer treatment is 750 feet away from the Subject. I notified the AMC who talked to the the Lender, Lender is leaving it up to me to decide if it's eligible. I think not, but want some input before I nix this one. (And should I even be the one nixing it? I thought the Lender made that call?)

Is it a Health & Safety Issue ?? you need to be able to support your conclusion (don't forget that part), so what does the municipality have to say ??
Probably fall under "Air Quality", and thats above your paygrade.
Good Luck

 

[dmckean]

C

Call your HOC but in general yes its eligible --we have one development that has over 500 homes adjacent one and basically as long as the treatment plant is permitted and signed off by EPA etc--The smell is not dangerious just offensive although people who live there said you get used to it. The same with homes close to the dairy .

I always look in the neighborhood to also see if other properties have FHA loans on them--NOW with that being said you don't determine if its eligible or not you just report what you observed and smelled - NOW the FHA DE Underwriter decides if its eligible. Personally as long as people live in that area I woudl not have a problem with it- As they say in car sales their is an-*** for every seat even a smelly one : )

Glenn, thanks for the quick reply. This property is on the edge of a small village and is actually not even on the village sewer system. There are few houses nearby and nothing in between it and the treatment facility except a bare field.

HUD 4000.1 addresses “externalities” which are defined as, “…off-site conditions that affect a Property's value. Externalities include heavy traffic, airport noise and hazards, special airport hazards, proximity to high pressure gas lines, Overhead Electric Power Transmission Lines and Local Distribution Lines, smoke, fumes, and other offensive or noxious odors, and stationary storage tanks.

I felt the smell was offensive and noxious (meaning very unpleasant). And then there are the stationary storage tanks. Bottom line, thius issue is likely to get worse as the village grows, rather than get better.

Thanks for the heads up on the FHA DE Underwriter.

 

[Terrel L. Shields]

I felt the smell was offensive and noxious (meaning very unpleasant). And then there are the stationary storage tanks. Bottom line, thius issue is likely to get worse as the village grows, rather than get better.

Your prognostication of that might be misplaced. Odors usually have a source and a complaint might mean the forced clean up of the property by the EPA or state environmental quality office. I would simply report that the odor from the plant was obvious and noxious and not make any observations about what it might be or do in the future. I would say that I am not an expert in detrimental conditions and decline the assignment.

 

[Sandra Koutsopoulos]

I agree, mark it as offensive & noxious odor, and let the underwriter approve or decline the loan. Probably would fly conventional. Re: intense cow odors, we had a strip down the (15) in Corona that I avoided even driving through 20 yrs ago b/c of the stink. Well, they sold off the land and moved the cows 30+ miles to the east. Built big 3000+ sf well-appointed houses on the acreage, nice & tight. While doing the appraisal inspection of the nearly-new house, I asked the owner if the smell bothered him. "What smell?" he says. LOL. 100' away they had a pipe burning off the methane from the ground saturation. I'll bet current occupants of those subdivisions only know their grass is very green, their gardens bountiful, and their house prices HIGH! So things can evolve with the correct mediation.

 

[glenn walker]

Actually most people get used to smells its more about is the smell hazardous or a Health & Safety Issue . Most sewage waste plants have to be signed off by EPA and City-County Health departments so it really comes down to marketability - The test is how many homes are bought and sold in that area every year if sales volume is decent then its passed the smell test- Chino Ca smelled like Cow Crap for 75 years but never slowed down buyers and sellers- The refinery down in El Segundo put out some odors but real estate prices higher than good smelling areas. I always use the occupant test-If its a refinance I know someone isn't bothered by it and if its a resale and if its in escrow I know a Buyer's not bothered with it - So now I have to ask myself if maybe I just have a nose of a Beagle and others don't. The TRUE TEST is not our nose but how buyers and sellers treat it

 

[Dublin ohio]

What happens when the wind shifts. Seems like you would have quite an area that could be impacted. Depending on wind direction.

 

[Stantheman]

I visited the property and noticed an offensive smell as soon as I got out of the car. Every time I came out of the house, the smell was there. Looked at the aerial map and the village sewer treatment is 750 feet away from the Subject. I notified the AMC who talked to the the Lender, Lender is leaving it up to me to decide if it's eligible. I think not, but want some input before I nix this one. (And should I even be the one nixing it? I thought the Lender made that call?)

Check this out article out.

Nearby Waste Water Treatment Plant Causes A Stink With New Home Buyers

Does A Massachusetts Seller and Realtor Have A Legal Duty To Disclose The Existence of a Smelly Waste Water Treatment Plant? Dear Attorney Vetstein: We purchased our first home in September. We wer…

massrealestatelawblog.com

 

[ramrcdk]

What happens when the wind shifts. Seems like you would have quite an area that could be impacted. Depending on wind direction.

Thumbs UP to a shifting wind!
Here we have a very High-Price area within the Smell Zone, a just-made-up term.
In-fill Construction & 100% absorption of the area, prices rising, etc. Existence for numbers of years of acceptance.
In setting up workfile, I will always hope for Sales from the same Subject dev'. If not so lucky, I will find older-dated sales (in & out) to extract possible Smell Zone differences.
I have never made a decision to: Name the smell, call it a hazard- EPA- etc.. Buyers want to reside there & I guess don't mind the smell.
What is necessary is to describe the Neighborhood boundary area including close proximity to a city water treatment center which via H&B uses already described & via use of adequate report sales, etc, etc. etc, DOES NOT appear to have adverse to buyer external influences.

Interesting Post #9.
Adequate use of Agency related Disclosure Forms & hopefully where the Buyer DID on-site "smell-test".
There could be an Upset Buyer who bought via "on-line" or via lack of Boots-On-Ground.
OR OR as of the effective date, it was later determined "the COVID buyer could not smell" !!!