While some are sounding an alarm and saying they were “completely blindsided,” others in the Lucas County real estate community are calling Maumee’s recently-passed sewer ordinance nothing more than a change in a process.
Municipal leaders, real estate professionals, and Maumee property owners are divided about how the new rule will affect home sales and the local market.
The ordinance, which was passed on June 17, requires Maumee property owners to pass a sewer line inspection before their property can be sold or otherwise conveyed.
If the property fails the test, the owner has 90 days to remediate the sewer problems or face substantial fines. Some Maumee property owners have already received some stunning five-figure remediation estimates from sewer companies.
“Initially, people may second-guess their decision to sell their homes due to this ordinance,” said Eddie J. Campos, the president of Maumee-based Northwest Ohio Realtors, “but people will eventually move. I have a client who is still going to list their home, but first they are going to get an inspection done next week and fix what they have to fix.”
“This was an inherited property with no mortgage,” he said. “The new ordinance is going to interfere with their ability to sell.”
Mr. Campos believes that Maumee’s sewer issues should be less of an individual homeowner’s issue and more of a community issue.
“This is a huge responsibility to put on people who are making a huge life change, something that they’d hoped would be a great thing for them,” he said. “Buying and selling a home is one of the most stressful things that people can go through — and suddenly somebody drops this responsibility on you at the 11th hour?”
At a community meeting Monday at the Maumee Elks Club, Garrett Luhring, a real estate agent with Luxion Home Team, sounded the alarm about the effects of the new inspection and repair regime.
“We’re starting to see a buildup of delayed sales,” he said. “As of yesterday, we have 30 properties on the market and 49 waiting to close. I know a handful of them are delaying the sale because of the sewer issues. As word of this spreads, it will create fear and uncertainty in the market, and that will make for lower home values and longer sale times.
“So home values will decline at a time when homeowners are being billed for expensive sewer repairs. This ordinance is going to eat up all the equity that people who have lived in Maumee only for a short time have built up.”
Other real estate agents are more sanguine about the effects of the new rules.
“It won’t kill our business,” said Dan McQuillen of the Danberry Company’s Maumee office. “If you’re a buyer, you’ll now have peace of mind knowing that the sewer issues have been remediated, but you might be anxious about the next ordinance the city decides to pass. Right now, though, the supply is tight and demand is high.”
At a July 16 public meeting at Maumee city hall, city Administrator Patrick Burtch also downplayed the idea that the new sewer maintenance and repair rules would slow down the town’s housing market.
“The housing market doesn’t react to just one single event,” he said. “People still come to Maumee for all it has to offer. When interest rates started to rise recently, some people predicted it would depress the housing market. But interest rates are now over 6 percent and people are still buying houses.”
In an article published by the Toledo law firm of Eastman & Smith, attorneys Gene R. Abercrombie and Lindsay Rich Steinmetz contend that the new ordinance “will have profound effects on real estate transactions.”
The article highlights the role that title companies play in enforcing the ordinance.
“If all violations are not corrected prior to closing, the seller and purchaser are required to establish an escrow account with the title company closing the transaction,” the report states. “In this case, repair estimates must be obtained from at least two companies and the escrow account must be funded with 110% of the highest estimate. ... Title companies are prohibited from recording a deed to convey the property unless there is compliance with the provisions of the ordinance.”
Char Stanek, the manager of Chicago Title’s Maumee office, confirms that the new ordinance has caused her company to set up some new processes to ensure compliance with the law but adds that the company has not added any charges to its usual title fees as a result. She is also upbeat about the general effect of the ordinance on real estate sales.
“I don’t think it will affect the real estate market at all,” she said. “It’s an adjustment in the process, nothing more.”
But Omar Deen, who owns a 1,304-square-foot ranch house on Loch Haven Boulevard that’s been in his family since 1995, has a gloomier perspective. Earlier this year, he made the decision to put the property up for sale in June, which he thought would be prime selling season. He set the asking price at $119,900.
“I was completely blindsided,” Mr. Deen said. “I just received my first estimate to the tune of $20,000. This would kill the equity in the house — money my family needs to pay off some debt and get a family van.
“What makes this worse is that I can’t back out of the sale because the city provides you with a 90-day window to remediate the problem, and that starts on the day you have your inspection. I must pick a contractor, deal with the loss of equity and close on the house, otherwise, I lose the buyer and still have to pay $20,000 to fix it.”
As he stood in front of his modest house, Mr. Deen seemed resigned to having to drastically alter his family’s plans.
“Because the 90-day clock is ticking, I have no choice but to lose equity in my home and fix the problems,” he said. “The city administration has killed the real estate market in the city, and people who want to move are going to be forced to make life-changing decisions.”
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