This odor is caused by the chemical breakdown of phenolic resins and heat-resistant plastics used in insulation, indicating a high risk of an imminent electrical fire that requires immediate attention. An electrical odor inside a home is an immediate warning sign of a serious, often hidden, problem within the wiring or appliances. Whether it smells like melting plastic, hot rubber, or a faint “fishy” odor, it often means wires, outlets, or breakers are overheating behind walls. If you're not sure where the smell is.