Cancer scare stalling home sales in The Acreage
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Residential Cancer scare stalling home sales in The Acreage |
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| March 03, 2010 |
By: Polyana da Costa |
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At the time, he didn’t think his cancer was an environmental issue, but as area residents began questioning the high number of cancer cases in the community, the father of three daughters age 2, 4 and 15 quickly put his house up for sale. Health officials recently confirmed the existence of a cancer cluster, which Thibodeau said is within a 5-mile radius of his house. Its cause is unknown. Thibodeau was asking $379,000 for his house last year. Knowing he’d have a tough time selling in an already distressed market and not wanting to damage his 820 credit score, he contacted his lenders to work out a short sale or deed in lieu of foreclosure. But Thibodeau said his lenders said that a “natural calamity,” such as a high concentration of cancer cases in an area, did not warrant a short sale or deed in lieu of foreclosure and said he should apply for a mortgage modification. Instead, last month, Thibodeau moved out of the Acreage home he’d lived in for seven years and is renting a place in Wellington. “Wouldn’t you do the same?” Thibodeau asked, noting that his home is four lots away from a house were a child who was also stricken with cancer lives. “This is a situation you don’t want to be in. My children come first. My wife comes first.” He quit paying the $330,000 mortgage on his house and hired a lawyer to try to work with his lenders, GMAC Mortgage and Citibank. There there has been little cooperation so far, Thibodeau said. “We are looking into this and will contact the homeowner directly,” said Jim Olecki, a spokesman for GMAC. He declined further comment. “We work with distressed borrowers whenever possible to help identify appropriate solutions based on their individual situations and financial hardship and we will work with this customer to address the issues that have been raised,” said a spokesman for the mortgage unit of Citibank. “I don’t even know what the fair market value of the house is at this point,” Thibodeau said. “Considering this cancer cluster, I would be shocked if it’s worth $200,000.” Thibodeau is one of about 15,000 homeowners who have seen their real estate dreams fall apart in the Acreage, which is 15 miles northwest of West Palm Beach and home to more than 40,000 people. Many sellers say they are leaving because they fear for their children’s health, according to real estate agents familiar with the area. Despite confirmation of a cancer cluster, homes have been selling in the Acreage. Many recent buyers have been bargain hunters, agents said. But now lenders are refusing to finance purchases in the area and sales are expected to stall, said mortgage broker Loddie Alonso of Real Estate Mortgage Network in Wellington. “I’ve got deals in the system that can’t be done because lenders and investors [that buy bundled mortgages] are saying they won’t finance there,” Alonso said. Local lenders, which she declined to name, also told her they won’t lend in the community. The Realtors Association of the Palm Beaches now requires that agents provide a written disclosure of the cancer issue to potential buyers. Alonso said she has written to Gov. Charlie Crist, warning that thousands of families in the Acreage face severe economic fallout as homeowners dump their properties on the market. “Homeowners that simply want to move up or away, will not be able to do so,” she wrote in her e-mail to the governor. “Those that are struggling with mortgage payments will not be able to refinance to lower their payment or short sale because no one can obtain financing.” “I currently have two transactions in that area that I will have to deny because of this situation. We will see more and more foreclosures. …We need some type of intervention to speed up the process of the investigation [of the cancer cluster] and bring closure to this issue, and then hopefully these investors will ease their restrictions.” Crist’s office said the Florida Department of Health is conducting radiation surveys in the area, and the Department of Environmental Protection is testing the water and soil in the Acreage. The state also is seeking help from the Centers for Disease Control and Prevention, the National Institutes of Health, and the U.S. Environmental Protection Agency. Residents, homeowners and real estate and lending professionals assert the various government agencies have been slow to address their concerns. Thibodeau said he knows of several other homeowners who have left or are considering leaving the Acreage. But others have too much invested in their homes to leave. Al Lopez is one. Lopez, who lives in an Acreage house with his wife and two teenage sons, said he spent about $200,000 of his retirement savings to build their 3,200-square-foot house. He pays about $3,100 a month on a $350,000 mortgage with JP Morgan Chase. ‘A GHOST TOWN’ He recently contacted the lender and, citing the depressed real estate market and the fallout from the area’s high cancer rate, asked that his mortgage be modified. “They asked me to pay $7,000 in closing costs, and they would lower my monthly payment by $240. That’s absurd,” Lopez said. “This place is becoming a ghost town. There ar e abandoned homes everywhere and they won’t even negotiate with us to make it more livable?” Attorney Daniel Kaskel of Sachs Sax Caplan in Boca Raton, who represents Thibodeau and Lopez in their negotiations with their lenders, said loan documents don’t provide a way out for borrowers based on environmental conditions. “The bank could at least get more by working with the borrower,” he said. “This is not a situation these borrowers created.” Kaskel said he continues to receive calls from homeowners in the Acreage who want to leave their homes while minimizing the impact on their credit. “The owners at the Acreage are not flippers,” he said. “Every homeowner in there is losing.” Martin Berze, an agent with Drysdale Realty who also provides lenders with broker price opinions on Acreage properties, agrees. “I remember homes in 2001 that sold for $380,000 now selling for $130,000,” he said. Berze said if state and local government agencies don’t step up to urge a more rapid resolution or to at least determine the cause of the cancer cluster so the problem can be addressed, the real estate market at the Acreage will soon “collapse.” There has been at least one case in Florida where the government had to buy out homeowners due to toxic contamination of the soil. In 1997, the state paid about $23 million to relocate approximately 350 residents from an area in Pensacola after a cancer-causing agent was found in the soil near their residences. But this is unlikely to happen in the Acreage. There are thousands more homes involved, and, unlike the Pensacola case, the cause of the health problem is unknown. Nancy Drysdale, Berze’s mother and an agent who has sold homes in the Acreage for years, said until this issue is resolved it is likely only cash deals will take place there and prices will have to fall dramatically. “I think there has been too much hype and not enough facts,” she said. “I am hoping the government and the lending industry realize exactly what they are doing because people are being emotionally and financial hurt.” Polyana da Costa can be reached at (561) 820-2065. Steven Thibodeau photo by Melanie Bell |
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