(CBS) -- Thousands of homes in the Chicago area are designated as landmarks, or may be in the future. And you may not know what that means until you decide you want to fix it up or take it down and build a new home.
The Chicago Landmarks ordinance requires that the side of the house facing the street must be preserved. Other changes may also need approval from the city Landmarks Commission.
It's a process one couple found financially devastating.
"We stepped in a big pile of Chicago, and it stinks," says David McClain.
McClain and his wife Sanaa say they didn't know two years ago when they bought a home in Beverly that it was in a landmark district.
"It's part of the Longwood Drive Historic District," Sanaa McClain said, "and we live on Seeley."
The McClains also say the former owner never disclosed it, and the landmark status did not show up on the title search done before the closing on the house.
And because they planned to gut it, "We didn't need a home inspector to say it had bad plumbing, bad electrical," says Sanaa McClain, "because we knew that we had to do all that, anyway."
Then, while clearing out the house they noticed a pungent smell and began feeling sick with headaches, ear aches and their son Liam's congestion was bad.
They hired companies to test for mold and they found it, including aspergillus penicillium, a potentially toxic strain at very high levels in the basement. Liam McClain has ongoing medical problems, and his doctor wrote that based on the mold findings, the house is "unsafe not only for Liam, but even for a healthy person to live in."
A mold-remediation company estimated the cost of removing the mold at $125,000 but would give no guarantee it would permanently take care of the problem.
Jim Kolke, the owner of Pinnacle Property Inspection Services, had more bad news. His inspection of the house found "the structure of the house is in poor to extremely poor condition."
He photographed evidence of insufficient support beams and floor joists that are "totally either rotted, or burned or cracked."
Additions in back and on the side of the house do not have required foundations. And decades of water damage have caused deterioration of the home's brick foundation.
Kolke said a combination of issues is causing the outer walls of the house to tilt inward and that home is "settling in the middle."
Basically, he says, "It's falling in from the outside."
"If this was my house," Kolke says, "there's no way I would even think about trying to repair this. It's a knock-down and rebuild."
The McClains decided to do that after a city inspector slapped a "do not enter" sign on the house followed by a Building Department letter saying the house is "hazardous in that it is dangerous and unsafe." The owners had 15 days to "put the building in a safe condition or to demolish it."
Their request for a demolition permit was approved by the department, but was then referred to the city Landmarks Commission for approval. The McClains say that's the first time they knew that the house was part of the landmark district along Longwood drive that is just east of their home on Seeley.
The city Landmarks Commission turned down their request to demolish the house after experts testified at hearings that the house was a historically significant example of the Dutch colonial revival style of architecture.
At those hearings, a building department official also testified that the letter demanding that the homeowners repair or demolish the house is not the agency's final word on the situation.
The official said the department believed the house could be brought into compliance with the city code, and if it wasn't, the city would then go to court to get a demolition order. That order is required by the Landmarks Commission to grant a demolition request.
A mold expert, structural engineer and architect hired by the city also testified that the mold, structural problems and other plumbing and electrical issues could be repaired to make the house "livable" without demolishing it.
They estimated the restoration costs at $267,000.
The homeowners' experts disagree, saying it would cost $900,000 to restore the house, compared to $400,000 to demolish it and build a new one.
The McClains submitted an architectural drawing of the proposed new house that would replicate what the original home looked like, before previous owners made changes to the exterior. The commission turned down that suggestion, recalled Sanaa McClain, "because it was not authentic."
"We are stuck. We can't sell it. We can't finance it. We can't develop it. We can't even go in it," David McClain says.
A spokesman for the city Landmarks Commission says it reviews all permit requests for landmark homes that can be submitted electronically, and 95 percent of the applications are approved by staff within one day. Demolition requests are more complicated.
The city spokesman also said that the landmark status of the house is documented in the old ledger books at the Cook County Recorder's Office. However, it is not posted on the Recorder's website version of the property history.
For now, the spokesman said, the McClains can either comply with the requirements of the Landmarks Ordinance or go to court.
You can check on the landmark status of a building by address on the city's website at cityofchicago.org.
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