Because most of the homes being torn down are older, there may be substances such as asbestos and other carcinogens that will be released into the air during the actual demolition. The EPA has set rules and procedures for capturing this toxic waste instead of allowing it into the air. However, in actual practice most demolition sites will have one unfortunate person with a slow running garden hose attempting to keep the carcinogenic particulates from flying into the air. Recently, the EPA has again issued additional warnings regarding the proper disposal of asbestos at demolition sites, so we may be seeing future enforcement.
Cities and towns are continuing to address the teardown issue. Most of these areas have many rules, laws, and procedures specifically directed at the demolition phase of a teardown. In addition to significant fees for permits, these laws allow for significant fines for each violation. Besides adhering to the local rules, laws, and procedures, these laws will incorporate the latest requirements from the state and federal agencies such as the EPA. Before you decide to purchase property for a teardown, you must review these requirements.
Once the teardown has been completed, the owner is then faced with more rules. Most towns that have had to deal with teardowns have enacted rules about how long an empty property can sit before building begins. There are rules regarding safety fencing, signage, cutting down trees, and other aspects of a property prior to building.
By far the area where there are the most rules and laws is in the actual building of the home. The builder is required to follow the building code of that city, which involves permits and fees, inspections and fees, and 100% compliance with the building code.