KITEC Plumbing and Its Consequences in a Real Estate Transaction
Updated: Nov 24, 2019
What you need to know when Kitec is present.
WHAT IS KITEC?
Often orange and blue, as seen above, Kitec is a brand of plumbing pipes and fittings designed and sold by manufacturer IPEX throughout the 1990s to replace copper pipe in heat distribution systems and plumbing lines in residential developments. It was originally boasted as a cheaper and more durable option to copper pipe.
Throughout the 1990s it was distributed to contractors throughout the US and Canada and installed in thousands of homes. Ironically, IPEX recalled the product in 2005 due to its tendency to quickly corrode. The pipes themselves weren't always the issue - instead it was often the fittings that were made out of zinc that caused the problems. Due to a process known as dezincification (I didn't make that word up!) the fittings were corroding and leaving a powdery buildup in the pipes, causing leaks and pipe bursts in worst case scenarios. FOR BUYERS - CAVEAT EMPTOR
It's not if Kitec will break down, it's when!
Buyer beware! This product has major shortcomings and you do not want to buy a house with Kitec plumbing without making some sort of compensatory provisions in your offer. Kitec is not just a possibly problematic product - it is fully defective and has been recalled by its manufacturer. Almost every site you visit for information about the product uses the catch phrase "it's not if Kitec will break down, it's when."
It is best to have a qualified home inspector evaluate the condition of the home and determine whether or not Kitec plumbing is present. If it is, get a plumbing company in to inspect the system - no plumber will put their name on a written document stating the system will require no future attention.
Additionally, from a buyer's perspective, have your agent push for compensation from the vendor if you decide you wish to continue with the purchase. A Kitec replacement job averages $6,000 - $8,000 and full compensation, if not replacement of all defective pipe, will likely be the best course of action.
I HAVE KITEC IN MY HOME
If you recognize Kitec in your home and were not aware that it was problematic you need to come to grips with it sooner rather than later.
Even if you are not selling, you will still want to have this addressed before you have a flood and significant property damage on your hands. Furthermore, you may want to check with your insurance company to see how having Kitec effects your home insurance policy - you may not be covered for damages in some cases since the product has been recalled.
Most often Kitec is discovered by a home inspector once an agreement of purchase and sale has already been negotiated and settled on however. Thus, compensation can often be a way to smooth things over between the buying and selling side. The purchaser may expect full compensation for the eventual replacement costs they are going to have to incur to get rid of the Kitec in the home. And while that may seem logical upon first glance, it does not always have to be the case.
COMPENSATION
Compensating a potential buyer is a likely outcome since they will incur major costs to replace the Kitec. But sellers need to know that buyers don't necessarily have to endure the entire burden of that cost for long.
In the wake of the recall of Kitec, a class action law suit was filed against IPEX and in 2011 multi-million dollar settlements were awarded in the US, Canada and Mexico. Thus, anyone having Kitec replaced can apply to be compensated for the cost of removal and repair. The compensation is handled on a case by case basis and more information, including claim application forms, can be found at kitecsettlement.com.
"The deadline to make a claim is January 2020."
Discussing options with your lawyer and filing a claim form could result in compensation for the cost of the repair. The deadline to make a claim is January 2020. Thus, while a purchaser may have to cover the up front expense of having the repair completed, they should not be out all of that money as they would have the vendor believe.
From the vendor's perspective, if compensation is sought, the purchaser must be made to understand that they will be reimbursed for the expense of replacing the system by filing a claim. With that reimbursement in mind, an offer to help ease the pain of the renovation required could be offered instead of full compensation. If framed properly, the vendor could save themselves serious dollars by being aware of the settlement against IPEX.
No matter what way it is approached, the presences of Kitec in a property complicates the nuance details of a real estate transaction. In these instances, people are happy to have a professional Realtor® on their side to ensure they get the maximum benefit available despite difficult circumstances.