A buyer client just asked me about the options, and costs, of dealing with aluminum wiring in a home. My response is partly just “stealing” from various sites on the web, but it is also colored heavily by my 20 years of real estate experience in Howard County Maryland. I’m not just talking about generic issues, but how, specifically, to handle this issue either as a Howard County home buyer or Howard County home seller. (For additional consumer tips as a home buyer or home seller in Howard County check out our blog and/or contact me directly). DDDDD
What Is The Problem With Aluminum Wiring? (How “Scared” Should I Be?)
Aluminum wire was used in the U.S. during the late 60’s and early 70’s. Homes in Howard County built between roughly 1966 and 1973 have about a 75% chance of having aluminum wire.
Aluminum wire alone is safe – every overhead power line in the U.S. is made with aluminum wire. The potential for greater fire hazard comes from a poor aluminum-to-copper connection inside the outlets and switches in the home. And, although aluminum wire has a “relatively” greater risk of fire, the risk either way is pretty small (say a 2-in-500,000 chance with copper vs. 7-in-500,000 chance with aluminum). You can read a decent history of aluminum on Wikipedia, or on this electrician’s website here.
The “problem” comes from a poor aluminum-to-copper connection between aluminum and copper wires, allowing for oxidation which leads to either “sparking” and/or excessive heat build up. The “solution” is to improve these “connections.” (You can request a list of the most serious home flaws common to Howard County homes here).
What Are Possible Solutions?
1) Rewire Entire Home With Copper Wire. This is an “approved” solution for sure, but would be ridiculously expensive (maybe $15,000 or more on a typical size home) and is almost certainly “overkill”. Remember, aluminum wire is perfectly safe – every power line in the U.S. is made with aluminum, not copper, wire. It is only the copper-to-aluminum connections which pose the risk, and the below two solutions address this in a more cost effective manner.
2) AMP Industries “Crimp” Method. Amp Industries developed a special tool to “crimp” together copper and aluminum wires inside a plastic sleeve that makes the connection near air-tight, thus preventing oxidation and its related fire risks from occurring.
This is not cheap, as AMP Industries doesn’t sell their crimping tool – they “license” it to authorized electricians who must pay a “royalty” fee for every single use. (What capitalist pig geniuses!). Electricians who are “licensed” to use the tool – only about 3-4% of all electricians – charge roughly $50-70 per outlet/switch, which ends up costing about $5,000 – $6,500 to treat the average size home with this method.
You can read about this method on this electician’s website (plus it has really cool, “scary” pictures of firemen next to a burning house!) or go directly to Amp Industries’ site Inow Tyco Electronics) – informative, but boring and now scary “firemen pictures.”
3) “Pig Tailing”. A third method, called pig-tailing, is similar to Amp Industries’ “crimp” method, except there is no special tool for “crimping” that requires a licensing fee, making this solution more cost effective still (around $2,500 or so for the typical home).
4) [NEW] In the past few years new devices have come onto the market (CopAlum outlets and switches for example). Some electricians say these are “the best” method to fixing aluminum wire. Based on what I hear from Howard County home inspectors, I’m not sure what to think about them as they are still a relatively “new” method of addressing the problem.
Which method is “the best”? As a layman I find it hard to tell. Very few electricians (about 4%) are licensed (by AMP) to do the crimp method, so of course these professionals will say that the crimp method is “the best.” Other electricians, who can’t perform the crimp method, will say that pig tailing is “the best.” Both have a bit of bias involved in their answers.
Most home inspectors I’ve talked with will say that either method is fine, though some insist that only AMP’s crimp method is satisfactory.
What Are The Odds Of Getting The Seller To Pay For Aluminum Wire Repair?
Of course this will vary depending on market conditions, relative negotiating power of the parties, and what type of “deal” has already been “cut”. (If you killed the seller on price already the odds are reduced he’ll kick in $6k for aluminum wire too).
Overall it seems to me that the following odds represent “normal” in Howard County:
a) 50% or more of the time the seller pays ZERO. (Including times when buyer doesn’t even request any “fix”).
b) 30% of the time: 50/50 split between buyer and seller.
c) 20% of the time: seller pays 100% of “fix” (though the type of “fix” may be debated).
What If The Home Has Never Actually Had A “Problem”?
Finally, some sellers will argue “it’s never been a problem before”, meaning that they have never observed any “problems” like sparking or scorching or fires.
That means nothing on this issue. Apart from the issue of exactly “how serious” a problem aluminum wire is, the risk it poses does not get better with time. In fact, the opposite would be true as more time gives more opportunity for latent oxidation to occur.
True, if during the home inspection the inspector actually discovers an outlet that shows “scorch marks” that can certainly help your cause in negotiating for repairs (and it highlights the value of a good vs. cheap home inspector). However, the absence of such evidence does not mean the wiring is somehow thereby “safe”. (Request a list of top-ranked home inspectors in Howard County here).
Does Aluminum Wire Violate “Code?”
Buyers and sellers can argue “code” compliance both ways. Does aluminum wire meet electrical “code” requirements for the county? Well, yes and no.
No, in the sense that new installations from about 1974 on must be copper wire, new aluminum wire inside homes is not permitted.
But, yes, aluminum wire does meet code requirements if it is already installed – as neither Howard County nor any jurisdiction in the union to my knowledge requires anything to be done to “fix” existing aluminum wire installations.
The “code” argument, then, is circuitous – and beside the point. A leaky toilet doesn’t “violate code” but you can still ask a seller to fix it.
If I’m A Seller, How Should I “Handle” Aluminum Wire?
As a listing agent I will have seller clients ask me whether or not they should “fix” aluminum wire (by whatever preferred means) before putting their home on the market. My answer is a clear no.
First, there is a chance the home inspector and/or buyer won’t make a big deal about the aluminum wire. If that is the case, you will have “wasted” your money on the fix.
My advice to sellers is this: if you know your home has aluminum wire, disclose this in writing to the buyer in the Maryland disclosure/disclaimer form. Question 8 on this form asks if there are “any problems” with the home’s electrical system. I advise sellers to write something like the following:
“Home has aluminum wiring, as do most of the homes built during this time frame. We have not observed any specific problems with this wiring.”
I like such a disclosure for a lot of reasons.
First, if you have a problem the best place to “hide” it is right out in the open. By being open and upfront about the aluminum wire, you’ll tend to diffuse it as an issue. Buyers will think – hey, if they are willing to tell us about it, it must not be a problem.”
Second, I think it gives you the chance to posture a bit during repair negotiations. If the buyer asks you to “fix” the aluminum wire you can respond, “Hey, we disclosed that to you before you wrote the offer. If you were worried about aluminum wire, why did you write the offer?” (Legally this has no effect at all – a buyer can, obviously, ask you to “fix” something that was previously “disclosed”. However, there is a bit of emotional/social “pressure” to such an argument).
Third, by telling the buyer the home has aluminum wire “as do most of the homes built during this time frame” you are letting the buyer know that, depending on the neighborhoods and/or types of homes they are looking at, they may well run into this problem on pretty much every home, again making it seem less of a “problem.”
Where Can I Get More Information?
For general info about aluminum wire, it’s risks and “fixes”, you can check websites earlier mentioned (history of aluminum on Wikipedia, or on this electrician’s website here) and/or Google the terms yourself.
For more information about local customs and practices in Howard County real estate, including how to negotiate for its repair (as a buyer) or avoid paying to repair it (as a seller), contact the John & Angela Team.
