Sat 28 Oct 2006
House of Horrors
Posted by Marlow Harris under Popular Culture, Real Estate
[8] Comments
If you’re finding it hard to sell your home, imagine how difficult it would be if there was a murder or other mayhem that occurred at the property. Perhaps obligated to disclose this by state statute, how much value does a home lose when a murder or suicide occurs?
The New York Times had an article about buying stigmatized properties (Some Buyers Regret Not Asking: Anyone Die Here?) This article makes a great point,
“Plenty of prized homes in the tristate area are more than a century old, and to experience their magnificence one must accept the fact that someone probably died within their walls.”
This theme was elaborated upon by the folks over at Zillow (If these walls could talk…..). It concerned houses where people had died or been murdered and the possible existence of ghosts or bad ju-ju in the home.
ABC News aired a segment How to Sell a House of Horrors — ‘Dr. Disaster’ Appraises Properties Where Chilling Crimes Occurred, about what happens when someone is killed, murdered or dies in a property. How much value does it lose? Will it ever sell? Apparently, if one holds on to it long enough, people forget. Nicole Simpson’s condo on Bundy, which sold just a few years after her murder for $590,000, $200K less than she paid for it, is now on the market for $1.8 million dollars.
The American Bar Association had a great article with a legal emphasis , Stigma Busters — A Primer on Selling Haunted Houses and Other Stigmatized Property. It used to be that sellers in Washington State were required to disclose a death in the home for sale. Now, the responsibility for investigation falls on the Buyers, as they have the opportunity to perform what’s called a “Neighborhood Review” where they can look into any past crimes, deaths or other disasters, traffic patterns, neighborhood noise, proximity to shopping and the like. Wanna see if there are any sex offenders in the neighborhood? King County Sex Offender Search.
Have you already bought a stigmatized house? Contact Heather Mack. She has an MA in Pastoral Studies from Seattle University and performs “House Blessings” to purify the home. You can call her at (206) 330-7158 or email her at HeatherAnnMack@Yahoo.com
Profs. Larsen & Coleman did a study of stigmatized homes and found they took 45% longer to sell, and for less $, which is no surprise. The issue of disclosure is interesting. We did a post on this and, as you note, some states (minority)require disclosure, but what qualifies as stigmatized is not subject to uniform definition. The appraisal of stigmatized homes is also an interesting niche. Randall Bell, The Master of Disaster from Laguna Beach, was consulted on the Nicole Brown condo.
Here’s the link to the post:
http://tinyurl.com/yzh8os
Also in the post is the link to Stambovsky v. Ackley, NY’s most famous haunted house case where the buyer sued to get his money back after buying a “haunted house” and WON. For the brokers involved that was a scary story.
A final note on House Blessing. I have personal knowledge of a case where the owner of a house had paranormal activity and engaged the services of a house blesser. ANd it worked.
Here in Washington State, the seller was required to disclose of a murder, death or suicide in the home, if known. About 10 years ago, they changed that disclosure to require that Seller only disclose a “material fact” that may affect value, without specifying what kind of fact was material. Locally, more burden has been put on the Buyer by offering them a 3-day “Neighborhood Review”, where they can research anything they think may be material in their decision to purchase a property. This takes the responsibility away from the Seller, as they now do not have to disclose the presence of a sex offender or half-way house in the neighborhood.
The Neighborhood Review is an interesting idea—similar to the 3 day rescision period for timeshare purchases. In NY the Seller is required to complete a Property Disclosure but there is a big loophole—if the seller refuses, they credit the buyer $500 at closing. Virtually all sellers choose to pay the $500 rather than risk a case over non-disclosure of material fact.
That’s nutty!
Here, the attitude is “Disclose EVERYTHING” because then, if you do, they can never come back and sue you for something wrong with the house.
What’s nuttier is that sellers of co-ops are not even required to fill out the disclosure.
Congrats on the win. As a very litigious state here in CA we must disclose all but you bring up a very valid question on just how much do these things effect the value and how long does that prevail. Good points.
No disclosure of murder/death/suicide is required in Arizona. But you do have to disclose if there was ever a meth lab in the home. I suspect however, those that run a meth lab are probably unlikely to actually put it into print…
We have sold a stigmatized home in the past. Under Florida law we are not required to disclose events such as these…By the way congrats for winning “The Most Horrific” category on the Real Estate Tomato Halloween Contest…My Best=The Lovely Wife From Active Rain.