The department, after consummating a purchase under the provisions of this article and the veteran having occupied the property as required by Section 986.3 of this code, may waive the occupancy requirement for a period not to exceed four years on a showing of good cause. The department shall establish standards for the occupancy waiver and shall make those standards known. The department shall waive the occupancy requirement in any case where the State Department of Health determines that health hazards on adjacent property render the farm or home unsuitable for occupancy, and such waiver shall be effective as long as such conditions exist.