How to avoid buying a real estate money pit: The importance of doing underground storage tank (UST’s) inspections for homes in San Mateo County
The importance of doing underground storage tank (UST’s) inspections for homes in San Mateo County
This is my “Why” for getting my real estate license. We worked with a local buyer’s agent & the seller was also represented by a local agent when purchasing our Burlingame home in 2004.
Short version: We were in our Burlingame home (Lyon Hoag neighborhood) for a few months & discovered two underground fuel tanks under the driveway which the sellers knew about & obscured the above-ground evidence. The sellers & brokerage also failed to disclose that the overpass across the street from our home was also going to be torn down & there could be potential eminent domain takings in the neighborhood. We had not one but two major items not disclosed. We ended up spending $80,000 on legal bills & $30,000 to remove the tanks & clean up the soil & groundwater contamination. It was an 8-year process to settle with the sellers & the brokerage.
As a result of this experience, I decided to get my real estate license in 2005 with the goal of protecting my clients from ever having to go through litigation or dealing with a costly surprise when handling a real estate transaction. My process to protect clients is thorough inspections with reputable companies along with making sure the disclosures are properly filled out by the sellers. Ninety percent of the time, when working on the purchase side I end up sending back a transfer disclosure statement (TDS) or the supplement to the TDS because the seller has not filled out all the details or elaborated when needed.
I believe most sellers & their list agents try to do the right thing but when they don’t it can be a very expensive & stressful process for buyers to right a wrong.
Underground fuel/storage tank (UST) removal from Burlingame home
Underground fuel/storage tank (UST) removal from Burlingame home
Original version posted 9/2010:
I had the “interesting” experience in 2005 (prior to my becoming a licensed agent) of learning first hand the process behind removing underground storage tanks. Unfortunately, unlike in San Francisco which recommends sellers or buyers have underground storage tank testing for older homes as a point of sale procedure, the same recommendation is not in place in San Mateo County.
To make matters worse, some believe that the natural & environmental hazards report (you may hear it called a JCP report) indicates if there are tanks on a property. This is somewhat incorrect; the report only indicates if there are known tanks on a property, typically those which have an open case & are either being repaired or removed/decommissioned.
Tanks more typically are found at the obvious commercial businesses such as gas stations or car rental/automotive shops but were also common on pre-1950’s homes as storage for heating oil.
To determine if a property has tanks, one must do a tank inspection. I sure would have appreciated knowing this nuance of San Mateo County property prior to my purchasing a home (via a local agent) which had not one but two UST’s! The discovery came about a few months after moving in while the old concrete driveway was being removed.
One tank had heating oil (this was the fuel for furnaces in older homes prior to gas) & the second tank had gasoline (probably an original homeowner fueled a car in the garage).
We quickly had a tank inspection company confirm tank presence including above ground evidence (fill pipes in the driveway, formerly covered with a concrete cover, vent pipes at the side of the property, & a former dispenser pipe in the garage).
For the record, we did have property inspections. There was personal property of the sellers obscuring this above ground evidence in addition to general property inspectors are not trained to inspect for UST’s, that is a separate type of inspection.
Removal of underground storage tanks from San Mateo County residence
It cost about $30,000 to remove both tanks followed by removal of contaminated soil & pump out of contaminated water over a period of ~12 months. Further joy when we had to undergo one of the wettest winters resulting in having a mud swamp for a front yard/driveway.
Additional legal costs were incurred as we pursued the sellers for non-disclosure (we happened to find the owner who confirmed that sellers were aware of the tanks; prior to more stringent environmental regulations, UST’s were commonly removed by homeowners & taken to the dump & weren’t considered a big deal.
More good times & astronomical legal costs followed during the legal process of mediation & arbitration; the judge did rule in our favor and the sellers are on the financial hook. Still, would rather have just known upfront about this “nuance” in this county because I sure would not have purchased a property knowing tanks were present.
More photos below via Flickr photo album.
