As interest in buying homes tumbles, East Palestine home owners feel stuck with no escape
Alyssa Corasello spent the morning of March 4 loading up a U-Haul in East Palestine, Ohio. Corasello, who is five months pregnant, decided that she had to move away from the area because she was worried that environmental contamination could harm her unborn child.
More than a month has passed since a Norfolk Southern train derailed on the outskirts of East Palestine. The company continues to clean up toxic chemicals that were released in the aftermath — a process that is expected to continue for weeks, if not months. The company and government officials continue to say the air and water in the area are safe, according to tests they’ve conducted.
Corasello said she didn’t want to risk it.
“I don't know whether it's from the train derailment or my pregnancy,” she said. “I throw up every day, and I'm sick all day.”
The day after Corasello packed up her things, Norfolk Southern agreed to pay residents around $500 per week to relocate while the company finishes cleaning up during the next two months.
But many parents with young children in the area are leaving for good, or considering it. Attendance in the East Palestine School District has dropped by 3%, or about 40 students, in the month after the derailment, according to the district superintendent.
Corasello’s landlord let her out of her lease. But more than two-thirds of the roughly 2,000 housing units in East Palestine are owner-occupied, and many homeowners believe that, even if they wanted to move away right now, no one would be willing to buy their homes.
There’s already some evidence they might be right. Local realtors say some buyers have backed out of sales. Others who had been looking to move into the area have stopped looking. And there’s still uncertainty about how banks, insurance companies and real estate appraisers will respond. At least one insurance company in the area, Allstate, has stopped offering coverage to new homeowners in the area.
Kelly Iverson, a lawyer for Lynch Carpenter in Pittsburgh, has been appointed the lead counsel for plaintiffs in a number of complicated lawsuits. She said many East Palestine residents are in an impossible bind.
“They don't have the resources and the funds to go up and move and find themselves another place without selling their location now,” she said. “So they're really in a Catch-22 where they're stuck somewhere where their health, their livelihood, everything is at risk.”
Not everyone in East Palestine is upset. Some residents say they’ve put their trust in authorities to clean up after the derailment and are planning to stay. Others say they have worries but don’t want to leave their homes behind.
Experts say the full extent of the impact on local home prices may not be known for years until there’s more clarity about what kind of contamination might be present and how far it has spread.
Jesse Saginor, a professor at Florida Atlantic University, has studied the impact of contamination on real estate. He said the stigma of the derailment will likely remain for a while, regardless of whether significant contamination is found on properties. And East Palestine’s rural location may make its recovery period longer.
“Some markets might rebound much faster if you have a lot of population growth and people need places to live,” Saginor said. “In rural areas, that rebound might not be as quick because there's not necessarily a huge demand for real estate.”
Norfolk Southern didn’t respond to multiple emails asking whether it would consider compensating East Palestine residents for the decreased value of their real estate. CEO Alan Shaw would not commit to compensating families for the loss of their property values during a U.S. Senate committee hearing Thursday, saying only, “I’m committed to doing what’s right.”
Patrick Souders, who lives near the derailment site, said Norfolk Southern has highlighted its commitment to invest around $12 million into the town, most of which will be direct assistance to residents. But that won’t come close to covering the impact on the town’s real estate market, Souder said, if more and more people leave.
“If you put $1 billion into this town, $1 billion won't even make it right,” he said. “You're never going to wipe off what they've done here. You're just not. They've just crushed this town.”
Patrick and Ruth Souders
Patrick Souders moved into his dream home six years ago. Patrick used a large portion of his savings to pay for the $98,000 house. Soon after, he met Ruth, and they eventually moved in together and married. They remodeled both bathrooms, installed new hardwood floors and had plans to revamp the heating and install a new roof.
Down their driveway, they have a massive barn where their children can practice barrel-racing with horses. Ruth’s 16-year-old daughter, Haylee, won an “all-around-cowgirl” award this year and received a saddle and a belt buckle.
They can see the site where the train derailed, feet from their porch. And they don’t know what to do.
The day after the accident, Haylee evacuated to her biological father’s home in Columbiana, Ohio, a couple of towns away. When she returned a week later, she started getting sick. The Souders took her to the doctor to determine if she had pneumonia. They hoped she would get better, but her coughing got worse.
“I told her she had to go stay at her dad's,” Ruth said. “Which I hate. I want her here. She wants to be home.”
Patrick’s home is so important to him that he didn’t leave even in the days after the derailment. It led to some tension with Ruth, who evacuated with her daughter. He didn’t leave until a toxic cloud of vinyl chloride gas burned and he saw a black cloud of smoke descending onto his property. He couldn’t breathe without a shirt up against his face, and he finally said to himself, “The hell with the animals,” and left.
“This place is my whole entire life. Everything I've worked for. This is the culmination of all my life's efforts,” he said. “Everything I have in the world is here. This is it. The family, the animals, the house.”
Ruth would like to sell the house now and leave if doing so was an option. Patrick doesn’t think it will be.
“They say, ‘Oh, home values will come back.’ I don't believe that. I don't think they ever will,” he said. “As long as you hear ‘East Palestine,’ you're going to think of this derailment and chemicals.”
Patrick has reason to be skeptical. Before the derailment, he was in the middle of switching his home insurance to Allstate. Then last week, he received a voicemail from his agent.
“Definitely love to try and help you out when we can. At this point with the train derailment Allstate has actually put a freeze on us being able to write homeowners policies in East Palestine and even the Negley area [3 miles away],” his agent told him in the voicemail.
A spokesperson for Allstate didn’t respond to questions about its business in East Palestine and instead referred WESA to the Insurance Information Institute, an industry trade group funded by insurance companies like Allstate, for a response.
“Because there are so many unknowns related to the East Palestine chemical spill, property insurers that service the area may be reluctant to write new business at this time,” said Mark Friedlander, the director of corporate communications at the institute.
Patrick trusts what he can see for himself more than what the company or the government tell him right now. The Souders drink bottled water now, even though officially their well water is safe to drink. He had to wipe an oily film off the front of his security camera when he returned home because it had become too smeared to see through. The two cows barely ate any food for about a week after the derailment. He’s been throwing away the top layer of his hay and hasn’t let his horses or cows out to graze on the grass more than a month later.
“The science is telling [government officials]…it's probably safe. So that's kind of what we're operating from. It's probably safe to be here right now. It's probably safe to drink the water,” he said. “But I certainly am not going to drink it.”
The Souders are planning to sign up for outside testing of their water and soil with a university. And they are trying to find a lawyer who might be able to help them recover some of their losses. They’ve never sued anyone before, but Patrick said he doesn’t believe they can recoup any of their losses on their own. He’s worried that, after a lawyer’s fees are taken out of a potential jury award or settlement years down the line, he still won’t recoup a loss in value of his home.
So their main hope now is that Haylee stops getting sick. They’re worried that she’s unusually susceptible to whatever chemicals might be on their property. They feed around a dozen barnyard cats, but only one of them started wheezing after the derailment. A lawyer told them it’s like two different smokers: one will die of cancer, while the other could live to be 90.
“If we do bring [Haylee] back and she gets sick and obviously she's having a reaction to something — then what?” he said. “What do we do at that point?”
Melissa and Ryan Henry
Melissa and Ryan Henry were in the process of divorcing and selling their home when the train derailed. Their four-bedroom house typically would’ve sold within days, their realtor told them. Now, they say, the only offer they’ve received on their $150,000 home was insultingly low: $50,000 below the asking price.
“We are literally stuck in this house,” Melissa said. “It's not just stuck with [Ryan]. I'm stuck in this contaminated, infested, chemical-bound house, and we're sick and we've never been this sick.”
Adam Gomez, a lawyer at Grant & Eisenhofer, is recruiting East Palestine residents for a lawsuit. He has worked on several class-action lawsuits involving disaster evacuations before, and he said it’s not unusual for investors to come into an area like East Palestine and try to buy property cheaply when people are desperate to sell. This could temporarily lift up the local real estate market, he said.
“Investors see it as an opportunity to potentially get property at significantly submarket prices,” he said. “But that, too, will ultimately trend off, and we'll see a lasting stigma and drop in property value.”
The Henrys are in the process of trying to get their house appraised. With that, their lawyer told them, they should be able to recoup the decrease in their property value from Norfolk Southern.
Gomez said events that have forced thousands of residents to leave homes and communities because of natural gas explosions, oil spills or forest fires are unfortunately too common. He said lawyers like him have been able to recover large settlements that include compensation for decreased home values. Such settlements include money for home owners who decide to stay as well as those who choose to leave, he said.
“If people are not made completely whole, they certainly are put in a much, much better financial position than they otherwise would be if they weren't part of a legal action,” he said.
In the meantime, the Henrys said they’ve developed a variety of health ailments, including rashes and bloody noses, which they said they didn’t have until after the train derailed. Melissa believed she had a rental home lined up in the nearby town of Columbiana, Ohio, but that fell through after the derailment, she said.
For the time being, she and Adam try to stay away from each other on days when they’re not getting along to preserve the peace for their two boys, who live with them. But the sickness, lack of sleep, stress and uncertainty has made Melissa irritable, and she said she finds herself lashing out at everyone.
“I'm just literally going by the seat of my pants, day by day,” she said. “I need to get my kids out of here.”
Jennifer and Frank Yonker
Frank Yonker had a health emergency last year that has made it difficult for him to climb the stairs in his family’s three-story home. The Yonkers wanted to move to a condominium without stairs in a nearby town. So they put their five-bedroom home on the market about six weeks before the train derailment.
Several interested families and couples came to look at the home in January. But since the train accident, the interest in it has dried up. When Jennifer went to speak to Norfolk Southern about their situation, a company representative strongly encouraged them to take the $1,000 inconvenience fee it was offering each resident, she said.
“[He] told me that I needed to take that money because that was a lot of money and it could really help me out,” Jennifer said. “And I said, ‘Sir, what I really need is for you to write me a check for $169,900, which is what I had my house listed for prior to the derailment. But you're not going to do that.”
She said she believes these kinds of statements from the company show a lack of respect for people in the town.
“It's an impoverished area, but that doesn't mean that we don't have folks that are educated,” she said. “ I'm a nurse. My husband's a chemist. So we understand what's going on with the chemicals and the seriousness of it.”
Jennifer has listened to a few lawyers but hasn’t signed up with one.
Gomez said he and his firm spent more than three weeks in East Palestine talking to residents about their options. Anecdotally, he said, he’s heard more than 5,000 people already have signed up for legal representation. And eventually, he believes, families like the Yonkers will be made whole, for both the loss of value in their homes and any other damages they’ve suffered.
But there’s still a lot that is unknown about the spread of any toxic chemicals. If it turns out that the contamination is relatively limited in scope to the area near the accident, Gomez said, the homes closest to the accident will suffer a much more severe price drop than those farther out.
If the contamination has spread much farther, the drop in value could continue for much longer, he said.
“I think it's going to be years before we reach the bottom of [a] drop [in house prices] as people continue to look elsewhere to buy property and will not be moving into the area and we see people moving out of the area,” he said.
That timeline isn’t helpful for people like the Yonkers.
“I need to be able to move. I need to be able to complete the process that we started,” Jennifer said. “And I can't do that. And I feel like Norfolk Southern is responsible.”
Only a handful of homes in the East Palestine area have been put up for sale since the derailment. But it’s hard to gauge whether that’s because people don’t think their homes will sell, or whether the vast majority of people plan to stay in the town, regardless of what happens.
Many residents want to stay. Saginor, the real estate professor who has studied similar situations, said those who stay after a disaster tend to skew older and have lived in the area for a long time and don’t want to leave.
That’s true for Joyce Davis, 76, whose husband died six years ago. Her son lives in a small house next to hers.
“I'm staying right where I am because my husband and I bought that house,” she said.
Davis lives in a 14” by 70” mobile home with five rooms where she keeps a long list of pets: 15 outdoor cats, nine indoor cats, six dogs, three birds, three snakes, two spiders, 14 cockroaches, a lizard, a rat and a sugar glider — a type of possum that can move between trees like a flying squirrel.
“My great-grandkids love to come and hold my snakes and my spiders,” she said.
Davis said she trusts the government and Norfolk Southern to do the right thing and clean up the town. She said she appreciates the $1,000 she received from the company.
“Everybody's complaining about how they can't sell their house now because our property values have probably dropped to the bottom,” she said. “But with all the testing and everything that's going on and the levels they're finding anywhere, it's not dangerous.”
She said she hasn’t gone to any town meetings after the derailment because she doesn’t like to hear people fighting and complaining.
“I understand there's people around that are really, really afraid, but they need to do something about that fear other than gripe about it,” she said. “But I don't know what that would be because I don't have that fear.”
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