A mineral known as pyrrhotite, which occurs naturally in New England, is wreaking havoc on homeowners across Massachusetts. Pyrrhotite causes concrete, the foundation material for many homes in Central Massachusetts, to deteriorate and then crumble. When pyrrhotite deterioration is discovered, the homeowner is left with two equally undesirable choices: make expensive repairs or risk crumbling the home’s foundation.
Due to the extensive scope of the work required, it is not uncommon for repairs to cost tens or even hundreds of thousands of dollars. According to a FEMA case study on pyrrhotite in neighboring Connecticut, the only way to properly repair a foundation where pyrrhotite has been discovered is to “lift the house off the foundation and completely replace all the concrete.”
Many homeowners get an even nasty surprise when they discover that their home insurance does not cover the repairs. Many others have no insurance at all. Even if they did, the problem for insurers with covering pyrrhotite-related damage is that the destructive work happens slowly over time. If the foundation were to be destroyed immediately, catastrophic loss coverage could occur.
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However, pyrrhotite takes years to destroy a foundation. For this reason, insurers in the region have adopted a policy of refusing to cover repair costs associated with pyrrhotite-related damage. This exacerbates the problem for homeowners. Many banks and lenders in the region are reluctant to lend homeowners the money they need to make the repairs, even if they have equity.
Credit insurers take a purely risk and numbers-based approach to approving loans. Given all this, why would they lend money to an asset whose foundation is crumbling? If the homeowner defaults, the bank will be stuck foreclosing on an investment with a crumbling foundation and trying to get that money back at public auction. It sounds like a recipe for losing money.
All of this has a devastating effect on homeowners. Many have horror stories of sudden situations where their most valuable asset becomes worthless unless they make repairs they can’t afford. Even if they try to sell, real estate disclosure laws will require them to inform the buyer of the presence of pyrrhotite in the foundation. Decades of asset appreciation are being wiped out.
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Few things make a home less attractive than knowing that it has a crumbling foundation that could cost several hundred thousand dollars to repair. The saddest aspect of this story is that the fate of many affected homes was sealed the day the foundation was poured. Because pyrrhotite occurs naturally, it inevitably found its way into the concrete supply of quarries across the state.
For decades, developers across Massachusetts have ordered and poured countless tons of pyrrhotite-contaminated concrete. Unfortunately for affected homeowners, the slow pace of pyrrhotite destruction means they are well past the time limit within which they can still hold their homebuilders liable for the damage.
State laws have also been updated and quarries must now test for the presence of pyrrhotite in their concrete before shipping it. However, that only provides future relief and residents dealing with pyrrhotite-related foundation decay are currently suffering.
Many are joining forces to fight back by seeking legislative relief by having Massachusetts adopt a solution similar to the one Connecticut used to address its pyrrhotite problem. State Senator Ryan Fattman is one of the most vocal supporters of the proposed legislation.
At a meeting with affected homeowners, he said, “That’s the key mechanism where we can create a statewide program similar to what Connecticut did where they added a fee to homeowners’ insurance and then put that money into a fund to finance. the change of the foundation for houses with a crumbling pyrrhotite base. And that’s what we hope to do here.”
The future of the legislation is not clear; However, it seems there is consensus that something needs to be done. If not, homeowners in Massachusetts could continue to see their property values decline as pyrrhotite slowly destroys their home’s foundation from the inside out. That would ultimately hit county budgets across the state, because most Massachusetts counties fund vital services like public education, fire and police with private property assessments.
Pyrrhotite is a naturally occurring problem that few people could have seen coming. Now that the time has come, Massachusetts lawmakers, homeowners and insurance companies must come to a mutually acceptable solution. If not, this pesky natural mineral could potentially threaten the foundations of the Massachusetts real estate market.
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This article The Pesky Natural Mineral Is Shaking The Foundations Of Massachusetts Real Estate originally appeared on Benzinga.com
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