Wednesday, August 10, 2011

Macon County, NC Real Estate: Material Matters

FHA  Subdivision Site Suitability Requirement

Developers who expect to offer FHA-insured mortgage loans for homes in their proposed or newly-completed subdivisions must complete a Builder's Certification of Plans, Specifications, & Site disclosure statement in order to qualify.

FHA concerns:
(1) Does the site have any rock formations, high ground water levels, inadequate surface drainage, springs, sinkholes, etc.?
(2) Does the site have unstable soils (expansive, collapsible, or erodible)?
(3) Does the site have any excessive slopes?
(4) Does the site have any earth fill?
If "Yes," will foundations, slabs, or flatwork rest on the fill?
Builders who answer yes to any of the above questions are expected to respond with confirmation from state licensed engineers that home sites are sound. This procedure is intended to safeguard FHA underwriting risks and provide homeowner security.

As the following research shows, Macon County building sites are exposed to mass land movement, underground landslides and unstable soils.

Macon County, NC Geologic Hazards

As this landslide incident map details, Macon County, NC home sites and HOA-deeded roads are likely to be impacted by earth movement. In extreme cases, these forces can be deadly. The Fishhawk Mt., September 2004, debris flow is an example of a catastrophic landslide. This swift-moving mass killed five residents and destroyed fifteen homes in the Peeks Creek area of Macon County.

Fig. 4. Shaded relief map of Macon County, NC and known locations of debris flows (white circles)
from the complete NCGS database (as of August 2006). The shaded relief map was constructed from a
6 m pixel resolution light-detecting and ranging (LiDAR) digital elevation model (Wooten et al., 2007/2008). Source

Western North Carolina Landslide Hazard Maps

All Western North Carolina mountain counties, including Macon, are classified landslide-hazardous. Federal Emergency Management Agency officials, state geologists, soil scientists and independent researchers define the risk as significant. Western North Carolina landslide/soil hazard maps were intended to: which areas are prone to landslides, and that will help developers, county officials, and residents decide where to safely build homes, roads, and other structures.— Governor Mike Easley October 2006
The North Carolina General Assembly defunded the Western North Carolina Landslide Hazard Mapping Program in June of 2011. Of the nineteen counties covered by the Program only three county landslide hazard maps have been released. They are Macon '06, Watauga '08 and Buncombe '09; remaining: Alleghany, Ashe, Avery, Burke, Caldwell, Haywood, Henderson, Jackson, Madison, McDowell, Mitchell, Polk, Rutherford, Swain, Transylvania, and Yancey.

Western North Carolina Soil Surveys

With the closure of the Western North Carolina Landslide Hazard Mapping Program, affected parties will have to depend on another resource when making a decision on whether to buy a Western North Carolina home site.

The standard reference for land-use planning, be it for agricultural production or residential development, is the county soil survey. These decades-old studies provide data as to whether soils are practical for a specified use. In the case of Western North Carolina mountain slope soils, the surveys, including Macon's are clear, the region's soils are "poorly-suited or unsuited" for dwellings, roads, and septic tank absorption fields. As noted, FHA classifies unstable soils as adverse site conditions.

Consequence of Macon County, NC Steep Slope Development

Mountain slope subdivision development has left Macon County property owners with "unstable roads and house sites, unlivable homes, and hundreds of foreclosed lots...." Lewis Penland, Macon County Planning Board Chairman December, 2010

Although Mr. Penland comments were circumspect, he was likely referring to news reports re the multiple Wildflower subdivision slope failures and the Boggan home site underground landslide.

Wildflower's collapsing road system is similar to those in a Swain County development. According to testimony in the Alarka Creek Properties Homeowner Association lawsuit, roads in the Timber Creek Estates and Eagles' Roost, subdivisions are "perpetually in peril."

Destructive underground land movement has been reported in HaywoodJackson and Macon Counties.

Ultima Carolina Wildflower Subdivision Landslides Macon County, NC

SouthWings photos of Wildflower landslides

Craftsman's Village/Boggan Landslide

Photos of Craftsman's Village construction site and view of Boggan
landslide property damage—Macon County News

Western North Carolina Real Estate Disclosure Issues

Since 2007 there have been several legislative attempts to regulate Western North Carolina county land development practices and require hazardous-land disclosure. The Safe Artificial Slope Construction Acts [2007-2011] were not successful.

Western North Carolina real estate is an especially high risk investment because homes have no insurance protection for expected earth movement property damage.  The risks increase for those who live in planned communities. Residents in HOAs have a
non-negotiable obligation to maintain and repair roads on unstable slopes. Developer-designed roads often do not meet minimum state engineering standards.

The Missing Macon County Landslide/Soil Hazard Maps

Landslide/soil hazard maps have been removed from the county web site and Realtors pretend these documents do not exist. The state will not intercede in this matter.

North Carolina Association of Realtors

Trust in the North Carolina Association of Realtors is unwarranted. Purchasers should follow FHA mortgage underwriting standards and hire a professional engineer for advice.