Asking whether active mold infestation affects the value of your house will get you the same emphatic "Yes!" answer that you would get if you asked a baker whether mold affects the value of a loaf of bread. Mold is unsightly and may cause health problems, and its presence also makes it difficult to insure a home. The question is whether a property with a history of properly treated mold infestation also loses value.
What is mold?
Mold is the common name given to any one of a number of nasty fungi that can infest older and poorly constructed homes, particularly around plumbing joints and other sources of moisture. These organisms include potentially toxic black mold, Stachybotrys chartarum, which can spread throughout the house as it reproduces by shedding microscopic spores. These spores may cause illness and the spreading infestation of mold must be controlled by a licensed mold removal specialist.
Mold and Property Values
Property valuation experts Marion R. Johnson, Paul A. Welcome and Darla Frank found that a severely infested luxury home in Kansas lost 53 percent of its value because of an active mold infestation. Jack C. Schoppa, a financial adviser, writing in "Realty Times," summarizes other case studies to find an average devaluation of 17 to 23 percent because of the presence of mold. Regardless of the actual amount of devaluation, which Schoppa points out is subjective, other issues such as the unavailability of insurance can make it difficult to sell any property that is infested with mold.
Both the case study performed by the team of Johnson, Welcome and Frank and Schoppa's research point out that some homebuyers will not consider buying even properly treated homes with histories of mold at full price. Schioppa estimates that homes that have undergone proper and documented treatment for mold lose about 3 percent of their value. The home covered by the team still lost 50 percent of its value even after proper treatment. However, attitudes to mold are changing according to Patrick Barta of the "Wall Street Journal," so the figure presented by Schoppa seems more realistic.
Purchasing an Infested Home
Never even think of purchasing a home that is infected with mold unless you receive a price reduction that will more than cover mold remediation by qualified professionals. Even then, ask the seller to pay an independent appraiser for a proper valuation of the home and to allow you to obtain quotes from mold remediation firms. Contact your insurance agent to make sure the home is insurable, and contact your mortgage agent to make sure you can get any necessary mortgage before you are able to move in.
Dealing with an Infested Home
If your home is infested with mold, contact a mold abatement specialist and have it cleaned thoroughly. Especially if you are ready to sell, have a plumber or other expert contractor deal with the source of the mold, which can be leaky pipes, old drywall, improperly waterproofed exterior structures or a combination of factors. Make sure to have all abatement procedures and repairs documented so you can show potential buyers that any issues you may have had have been properly dealt with.
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