Environmental

Formaldehyde is an environmental concern in real estate primarily because:

AIt is found in older exterior paint on pre-1950 homes
BIt is released from certain building materials (pressed wood, insulation) and can cause health problems✓ Correct
CIt accumulates in basement water supplies
DIt causes corrosion of copper plumbing

Explanation

Formaldehyde off-gasses from building materials like pressed wood products, urea-formaldehyde foam insulation, and some adhesives. It is a known irritant and probable carcinogen that can cause respiratory problems.

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