Buying An Old House In Northeast Florida?

 Are you thinking about buying an old house in NE Florida or are you a Realtor selling your first old house?

Older homes are wonderful, especially, in our area. Some of the craftsmanship is remarkable and would be difficult or impossible to find in a modern home. Sometimes the value of the home and the neighborhood are simply too good to pass by.  However, there are several things that you need to be aware of during the due diligence process. 

First, let’s talk about that old house. What is an old house? Well, the home owner’s insurance industry is helping us define an old house. Some would say, 20 years would make the home old. Some will say 30 years makes the home old.  The insurance requirements may make them equal.  For sake of argument let’s assume you are thinking about buying a home that is 35 years old or you are a Realtor selling that first older home in a similar age bracket. 

Secondly, what’s the worry? The greatest everyday risks to an insurance company are fire, wind, and water loss from leaks, be it a roof leak or a supply or waste line leak.  Simply said, age of the home increases that risk of loss.

What do you need to know?

1.  Older homes in the greater Jacksonville area may have galvanized steel supply piping or was re-piped with Polybutylene plastic piping. Galvanized steel piping was used extensively from the 1940s through the middle of the 1970s. Typically this piping rusts from the inside out and will experience leaks and flow reductions as it ages.  Polybutylene plastic piping was used extensively in the 1980s as the water distribution system of the future. The problem with this piping is premature pipe leaks and leaking fittings, not to mention numerous class action lawsuits.

2. An older home in our area may have older shingles (roof covering).  Depending on the age of the home, you simply can’t tell from the ground if there is any remaining roof life. They may look good, and there might not be any leaks, but what about shingle tab adhesion?  Shingle tab adhesion is a critical component to withstanding a high wind event.  

3. An older home may have original wiring. As the home ages more and more demand is placed on the original wiring system as we install higher demand electrical fixture such electric dryers, new cook tops and oven and air to air heat pump. You know that stuff wasn’t around in the 1950s to 1970s. This places additional load on these original circuits. And older homes don’t have the same numbers of convenience outlets to plug in our lamps, computers, TVs, etc. Some of these older homes have only one or two outlets per room so owners end up using electrical strip centers. All of these things are fire risks. Older electrical distribution centers have fuses. Insurance companies don’t like fuses. Older homes often have home owner wiring, exposed wiring conditions, open splices, and other correctable electrical issues. All of these conditions can increase your risk and coverage.

 So, you have fallen in love with a cute bungalow in the San Marco area (it could be anyone of our wonderful eclectic communities) or your buyers are committed to an older homes charm and location. GET IT INSPECTED by a knowledgeable, trusted, home inspector. Your home inspector will be able to identify those risk factors and will put together what is commonly called a 4.0 Letter to use in the insurance buying process.

The 4.0 Letter will address four major components of the home, Heating and Cooling System, Plumbing System, Electrical System and Roofing. This information is then provided to the insurance company to assist them in understanding the home and the related risk.  It can also cause your trusted insurance agent to “pass on the home” causing you to shop for coverage.  This can be a trying process and don’t give up!

Additionally, a knowledgeable home inspector can help you understand those risks and can oftentimes suggest manageable solutions, such as prioritizing a to-do-list for improving conditions that may lower your insurance risk factors.

Now that we understand the 4.0 Letter there are some other factors that can impact you during the due diligence process.  Some mortgage lenders have concerns about loaning money on older homes, especially, if they are investor owned and flipped. They may require that a home inspection be conducted and that all items listed on the inspection report as a defect, get repaired. 

It is important to be informed and to ask those questions up front during the application process so you don’t have a delayed closing because repairs weren’t made.

Good luck.

Charles S. Gifford, ACI, RPI, CRC

President

AllSpec Services

CS Gifford Home Services, Inc.

Trusted. Valued. Experienced.

Each and Every Time!

Guranteed. ®

Certified ASHI Member 096358

FABI Registered Professional Inspector 0111

Licensed FL HI 1046

Licensed FL CRC 1326414

FL DACS WDO Inspector JE112133

Faulty Circuit Breakers Could Cause Fire
By Chris Glorioso and Tom Burke NBCNewYork.com
4/30/2012 11:15:18 PM ET MSN.com

Circuit breakers are designed to keep you and your family safe from fire, but one brand of breaker might not only fail to protect your family – it could actually cause a fire.

“There’s thousands of them out there,” Clifton, N.J. Fire Chief Vince Colavitti told NBC 4 NewYork's I-Team. “It’s a ticking bomb waiting to happen.”  The breakers, mostly found in homes built before 1990, were made by a now-defunct company called Federal Pacific

Electric, and experts tell the I-Team there are scores of those breakers in homes throughout the tri-state.
“Instant red flag. You see those and they’re suspect immediately,” said Colavitti, who is also a fire investigator. A circuit breaker is designed to trip during an overload or short circuit, thereby cutting off the flow of electricity and preventing a fire. But if the breaker doesn’t trip, the increasing current can cause the wires to overheat, and even ignite. Sometimes, Federal Pacific Electric breakers fail to trip. Colavitti said firefighters around the country as well as home inspectors and even some insurancecompanies are aware of problems with Federal Pacific Electric breakers. Some insurance companies are refusing to cover homes that have the breakers.

According to fire investigators, the Federal Pacific Electric breaker in Clarissa Rosario's NewJersey home did not trip when overheated wires were burning in the ceiling between her bedroom and the attic in 1999.
“I saw the light flickering and I thought it wasn’t normal,” said Rosario. “When I opened the attic, it was full of smoke.” Rosario was able to grab her two children and escape. Firefighters saved her home.
A family in Longmeadow, Mass. was not as lucky. Their home was destroyed in a 1998 blaze when electrical wires overheated and the Federal Pacific Electric breaker failed to trip.

In his notes, the fire investigator on the case wrote: “The Federal Pacific Electrical panels are notorious for
malfunctioning. Many of these circuit breakers fail to trip during an overload condition which causes the wiring to overheat and to ignite combustibles in the area.” Engineer Jesse Aronstein has been studying the breakers for decades. He has testified in lawsuits against the company and published reports about the failures. According to his research, Federal Pacific Electric breakers may be associated with as many as 2,800 electrical fires each year in the U.S. “People should know that these have a high defect rate and should be advised to have them replaced,” said Aronstein. Aronstein said Federal Pacific Electric cheated on testing and inspections decades ago to achieve approval from Underwriters Laboratories, a nonprofit product safety testing and certification organization. Nearly every item using or carrying electricity sold in the UnitedStates is tested and verified by UL. “They were applying UL labels to products that did not meet the UL requirement,” said Aronstein. According to Aronstein, representatives of Federal Pacific Electric would use a remotecontrol to “trip” the breaker if it didn’t trip properly during UL testing.

A 1982 Security and Exchange Commission filing by a company that purchased Federal Pacific Electric reads, “UL http://www.msnbc.msn.com/id/47240777/ns/local_news-new_york_ny/t/faul=#.T6E9X1Lhe4Y
Page 2 of 2 02/05/2012 07:57 AM listings on circuit breakers made by Federal Pacific had previously been obtained through the use of deceptive and improper practices.” The company and UL ultimately removed the UL listing for the breakers, but not before millions had been sold from the 1950s to the 1980s.

Not every Federal Pacific Electric breaker will fail to trip if overloaded and, after the company was bought in the early 1980s, the breakers were modified and did legitimately pass UL inspection. According to Aronstein, the safer, working breakers are marked with a white dot on the on/off toggle switch. He also
suggested that anyone with a Federal Pacific Electric breaker contact an electrician to determine if it should be replaced. Federal Pacific Electric is no longer in business and was ultimately divested by the company that purchased FPE. It exists now only as a legal entity.

Messages left with the last known attorney for the company were not returned.