Buried Oil Tank

[LAURIE ROCCHIO]

I recently appraised a house with a buried fuel oil tank. I disclosed this in the environmental conditions section of the appraisal, noted that there was no leakage noted on visual inspection, and suggested that if further information was required, an expert in this area should be consulted.

My question is this: Is that enough, or have other appraisers found that the very existence of a buried oil tank is adverse to value, and requires an adjustment on the sales comparison grid? Needless to say, I have been unable to find any good examples of paired sales to answer this question, and was just wondering if others had run in to this, and what they have discovered.

I appreciate any help that can be offered.

Laurie

 

[Joker]

Hopefully you were a little more specific than "no leakage noted on visual inspection". Inspection may imply that you "inspected" the tank.

I have not seen any problems in my market with the acceptance of a buried tank, either fuel oil, diesel, or gasoline. (many farms here have buried tanks) I would prefer a buried fuel oil tank. In my state, BUSTR does not apply to tanks used for storing heating oil used on the premises.

 

[JSmith43]

Laurie, I have to pile on and criticize the no leakage comment. You could have taken a picture and noted green grass, etc in the vicinity of the oil tank.

Perspective:

The remedial steps are generally to dig up and remove UNUSED oil tanks and bore & test the soil UNDERNEATH the tank. Now and then you will note an unused oil tank located under a garage slab. Short of excavation, the oil is pumped out & properly disposed of, the tank is drilled in place and a core sample of underlying soil is analyzed. If significant leakage is not detected, the tank is filled (with sand, I think).

That is somewhat dated information that I offer, and probably will vary by region. Your state Pollution Control Authority may delegate procedures for abandoning little tanks (1,000 gallons or less? ) to the fire department, health department, or local building authority. If my information is off base and someone specializing in polluted sites reads this, please update any glaring errors :lol:

 

[Ray Miller]

I always note the tank is there. Take pictures of fill pipe and vent pipe. Note that I am not an inspector. That the value may change if the tank is inspected and problems are found. I also note I have no knowledge if the tank complies with state codes.

 

[Walter Kirk]

Laurie,
The effect on value depends on your market area. Where is the property located?
Your statement about no leakage leaves you open to liability if problems develop later. Just note that the tank is there and do what Ray does.

 

[Jan Roseberry]

"The appraiser is not an expert in the identification of hazardous substances or detrimental environmental conditions. The appraiser's routine inspection of the subject property did disclose that there is an underground oil tank which could have a negative effect on value."

-- It's a good place to remember that we only report, we don't make the loan or call for inspections. Why say too much?

 

[jay trotta]

"No Leakage Noted" - do you have X ray eye's :question:

that was an "Underground" tank you were speaking of :question:

hit the "Delete Key" - get rid of the comment; underground tanks (on your part) should call for an inspection OR the past three years of "Oil Fills" by the existing or past "Oil Company" suppliers. This will provide the consistency with which the tank was filled and if the time frames for fills were consistent. (a leak could possibly be detected this way)

Bear in mind, that residential dwelling Tanks have a longer "Life Span" than do "Commercial Tanks". back in the early 1980's - there began the lament of the "Superlein Law" which was basically set in motion for "Commercial Properties" - years later it came into play for "Residential". The possibility exists for a residential tank to have a problem; but it more than likely will create less havoc than a commerical tank.

Several years back we did one where the "Seller" disclosed all the pertenent info. via a Realtor and the "Buyer" still went forward with the deal. We had to do the appraisal; gathered all the DEP (Dept. of Environmental Service) data, provided it to the "Lender/Investor" and the deal Closed in a timely mannor. We also included an ample amount of photo work in regards to the "Well Water Treatment System" that was put in place, B e c a u s e - it had seeped into the "Well Water" and in order to make it "potable" - it needed a treatment system.

Hope this lends a little insight for you; good luck - But watch your Language, very important On This Issue.

h34r: