Hopefully there will be some follow up comments after more qualified arborists visit the site and in the best case scenario the tree can be left there for a while. The HO must be inclined that way or this would not have lasted as long as it has (hunting and gathering investigative stage). Hopefully the neighbors involved are also on board with this attitude.
If some major buttress roots remain near the wound, decay has not progressed very much, there are no cracks in the stem, the primary pathogen/s are cultured and not found to be exceptionally virulent, the prevailing winds blow away from the houses involved, a cable system can mitigate the co dominant and other structural worries, the vigor and vitality of the tree is high, possibly there is a tree in the opposite direction from the houses that the tree might be anchored to. The HO and poss. with the help of neighbors can afford the treatments and monitoring costs.......then
the tree can stay around for a while longer. Isn't that really what all organisms are trying to do? Get in another day, then another?
My advice would also be to check insurance coverage in relation to tree damage and make sure of coverage in the event of failure. Like Guy said, any tree can fail and just because this tree has more issues than a less compromised tree does not make it a "must remove" in the ins. co.s eyes. I have had a multitude of trees over the years that were not perfect (none are) be covered when they slammed houses. The only MUST remove or lose coverage is obviously a totally dead tree.
Shigo was mentioned earlier along with the thought that even "experts" may be suspect in their ability to properly evaluate this situation. Shigo used to often muse as to the need for "specialists" in our profession that were credentialed. Tree risk evaluators, infectious disease specialists, root zone specialists, support systems experts, funding specialists, etc, etc, are some of what I imagine he would have in mind in this case. It might even be of some use in support of the tree staying to have the tree professionally evaluated as to a monetary value in relation to the property value.