A Times Editorial

Editorial: Don't leave home buyers in the dark on mineral rights

Mallory and Zach Sinclair — with children, Piercen, 6 months, and Greyson, 3 — didn’t know until closing that their Brandon townhouse purchase didn’t include anything of value below it.

EDMUND D. FOUNTAIN | Times

Mallory and Zach Sinclair — with children, Piercen, 6 months, and Greyson, 3 — didn’t know until closing that their Brandon townhouse purchase didn’t include anything of value below it.

No home buyer should get a surprise at the closing table. Nor should surprises be standard practice for a reputable home builder. But here in Tampa Bay, as elsewhere, it's apparently the modus operandi for the nation's largest home builder, D.R. Horton. For years, the company has been quietly excluding mineral rights from Tampa Bay home sales, keeping them for an affiliated energy company and alerting homeowners only through small-print disclosures. That's unacceptable, and Florida Attorney General Pam Bondi should follow the lead of North Carolina and pressure the company to stop. Then the Legislature should make clear that such surreptitious practices aren't allowed in Florida.

As the Tampa Bay Times' Drew Harwell reported Monday, more than 2,500 Tampa Bay homes have fallen victim to D.R. Horton's scheme in the past six years, some of them unknowingly. Others learned at the closing table after spending weeks lining up a mortgage, paying for appraisals and inspections, and hiring movers. Zach Sinclair, a homeowner in Brandon's Whispering Oaks, said he found out at the last minute when the builder's agent handed him the mineral rights disclosure and warned that without his signature the deal would be off. "I had a waiting kid and a pregnant wife who wanted to kill me. I just had to do what I had to do and assume nothing bad was going to happen," Sinclair said.

Florida law apparently doesn't require home builders to inform home buyers that they own mineral rights. County property deeds separating the above and below ground assets could alert title companies and Realtors involved in a home's sale — but Harwell's reporting suggests that in most cases in Tampa Bay, homeowners learned at the closing about the mineral rights, if they found out at all.

D.R. Horton has signed the Florida mineral rights over to its subsidiary, DRH Energy of Texas. Exactly what the company hopes to gain from the rights is unclear. But the documents grant the right to everything underground, from groundwater to natural gas to gemstones. And new technology, including hydraulic fracking and horizontal drilling, has given rise to options never before considered and fresh concerns about what they could mean to Florida's unique geology.

At least one state has fought back. Last year, after it came to light that D.R. Horton had pulled the same maneuver on 850 home buyers in North Carolina, state Attorney General Roy Cooper and the North Carolina Real Estate Commission launched investigations into whether the information had been properly disclosed to home buyers. That eventually led the company to stop the practice on future sales and eventually to return all the mineral rights back to owners. The issue erupted as the North Carolina General Assembly debated allowing fracking in the state, narrowly approving the controversial practice.

Bondi should consider launching her own investigation. Legislators should also respond and make it clear that sellers must disclose information about mineral rights up front, not at the last minute. It's a piece of consumer protection Florida is clearly lacking.

Editorial: Don't leave home buyers in the dark on mineral rights 11/13/13 [Last modified: Wednesday, November 13, 2013 6:29pm]

    

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