Tuesday, December 15, 2009

State Acknowledges Western North Carolina Real Estate Landslide Hazards

In February 2005 members of the North Carolina General Assembly had no difficulty recognizing the fact that hazardous-land real estate development would result in the continuing loss of lives and homes. Prompted by the catastrophic Western North Carolina landslide events of September 2004 and the need for federal emergency funding, legislators recommended hazardous-land identification maps as protective measures:

Hurricanes Frances and Ivan wrought havoc upon Western North Carolina impacting the region on a scale not experienced before in that area of the State. The President issued two federal disaster declarations for the Western Region of the State. During Hurricane Ivan, the community of Peeks Creek was devastated by a debris flow triggered by heavy rains. The debris flow traveled speeds as great as 33 miles per hour for two and a quarter miles from the top of Fishhawk mountain. Five persons were killed and 15 homes destroyed by the flow that was estimated to be several hundred feet wide and up to 40 feet high. Other communities that were particularly hard hit by landslides include the Starnes Creek area in Buncombe County, the Little Pine area in Madison County, the White Laurel community in Watauga County, and the Bear Rock Estates in Henderson County. Further...people could not know the landslide risks associated with their housing location because such maps are not readily available. The State needs to…prepare landslide zone mapping for the region so that homes may be rebuilt in safe areas.
Those regional real estate landslide maps are currently unpublicized works-in-progress. Only three out of twenty-five landslide-hazardous counties have been mapped: Macon 2006 , Watauga 2008 and Buncombe 2009.

Thanks to pressure from the North Carolina Association of Realtors, the federally-mandated landslide identification maps remain out of view and hazardous-land information is not communicated to at-risk clients.

Buying Favors

The North Carolina Association of Realtors touted its successful lobbying efforts on May 15, 2009 with the following legislative update:
Mountain Property Development and Disclosure Legislation

Legislation to regulate mountain property transactions and require local governments to more stringently regulate development in those counties was thwarted and instead the issues will be studied. Reps. Ray Rapp (D-Madison), Phil Haire (D-Jackson), and Susan Fisher (D-Buncombe) introduced HB 782 (Safe Artificial Slope Construction Act), which would require local governments to enforce more rules for development in the mountains and amend the residential property disclosure statement to include disclosure of certain mountain property. In response to opposition from REALTORS® from the western part of the state and most other mountain legislators, this bill was turned into a study bill to research landslides and have public hearings. There is to be a bipartisan, eight member panel which will report to the legislature in May of 2010.
The Failure to Disclose Material Facts

Western North Carolina Realtors have been apprised of the region’s hazardous-land conditions. They are also aware that all steep-slope (land above 15% grade) home sites will be evaluated and rated for landslide probability. Buncombe County real property was assessed for potential landslide loss in April 2009 but this data is not available to the public nor is it revealed on sales contracts or Subdivision Street Disclosure Statements.

Members of the North Carolina Association of Realtors may trust that they have no liability in this disclosure matter but they are mistaken. Anti-fraud statutes are clear. It is illegal to profit by schemes or tricks, by issuing untrue statements, by failing to disclose material facts, or by participating in deceitful and fraudulent business practices.

Western North Carolina Realtors can correct substantive contractual omissions by providing two addenda disclosure statements. The first is applicable to sales contracts and the second to private road ownership.

Western North Carolina Hazardous-Land Real Estate Disclosure Statement
Please be advised that you are buying property in a federally designated landslide-prone county.

The decision to buy a landslide-hazardous home site should be well-considered. Flood and fire property insurance is available. Landslide insurance protection is not obtainable. The inability to insure this high-risk real property will have an adverse effect on property values and perhaps the ability to refinance. Please seek legal advice concerning landslide liability.
Steep Slope Subdivision Street Disclosure Statement
This subdivision’s roads were built on likely unstable soils. Landslides and erosion are recognized chronic hazards above a 15% slope. Soil assessments for this subdivision can be found at the county Soil & Conservation Office. The developer was not required to conduct geotechnical, hydrologic or soil suitability studies for this subdivision. Should this subdivision’s roads be damaged by predictable natural occurrences, the members of the homeowners’ association will be liable for all repairs.

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