In the middle of a severe slump in the housing market, a recession, a locked-up credit market and a sea of foreclosures, the South Florida housing market is taking another hit.
Owners of newer homes are discovering corroding fixtures and suffering health problems they believe are the result of defective drywall imported from China during the housing boom.
"This is something that's only going to cause a more depressed value to the real estate that has this problem," Miami Realtor Alan Gabay said.
And nearby properties might become suspect, too. A home with Chinese drywall could have the same effect on the area as a foreclosure does: a drop in values and fears of the same problems.
"The timing of the manifestation is coinciding with the bust," said attorney Victor Diaz, who is suing on behalf of homeowners with suspect drywall. "It's a catastrophe, particularly if it's one community built all at the same time."
In the short term, this is probably true. But in the long run, some people think it could actually be a boon.
"It's really got us licking our chops," said Peter Zalewski, a principal with Condo Vultures. "It's fantastic."
The company is trying to research which communities – condo buildings in particular – are members of the Chinese drywall club.
"Ultimately, Chinese drywall means big discount. That's what buyers are looking for," he said. "Think of it like a junkyard."
Investors could end up buying condos in bulk at cut-rate prices, refurbishing them, then selling them at a profit, he said.
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