Many thanks to all the repliers, especially Critter, mglsharkson ,MANmom , ralleia and bsrsharma. Your experience /stories shared really educated me. There is so much risk out there for this house that I am not interested in it any more.
If we translate this extreme story to a generic question, don’t you agree that buying a new house has less risk involved than buying a resale one? Everything starts from scratch.