The Town Broker

Is Your Home Stigmatized By Homicide or Suicide? What You Need To Disclose.

Through the years, I’ve come across several home sellers who’ve shared their secret with me. Something happened inside their house. Something horrible…something unthinkable. On occasion, the secret involved a murder. Other times, a family member committed suicide inside the house. And now it’s time to sell. Will letting people know what happened scare buyers away? At minimum, these sellers worry that disclosure might decrease the value of their home.

And the truth it…it might. Do they need to share what happened to prospective buyers?

Disclosure Rules On Stigmatized Properties Vary From State To State

Stigmatized Properties is the term we use to describe properties that the public might shun for reasons unrelated to its physical condition. According to Christopher Strahan a real estate attorney practicing in Princeton NJ, “New Jersey law does not require a home seller to proactively disclose this type of stigma. But if the buyer asks directly, then the seller is obligated to share the truth.”  

A stigma could be caused by an event like one of those described above. Sometimes, the home becomes notorious…well known in the public space…because of something remarkable that happened there. The 1971 murder of Westfield’s List family by husband and father John List, is a story well known in these parts, and comes to mind whenever I think of notoriously stigmatized homes.  (Incidentally, the List home on Hillside Avenue in Westfield burned down years ago. Still, curiosity seekers still visit, searching for something…) “When a home becomes notorious, it enters a much murkier area from a legal standpoint” says Strahan. “Buyers often do their diligence online. If you can Google the address and it pulls up pages of results, then I think the seller needs to be prepared to address the issue”. 

Consider the Dutch Colonial on Ocean Avenue in Amityville, New York…the scene of the famed Amityville Horror.

There Are Many Types Of Stigmatized Homes

According to Wikkipedia that there are numerous ways a home can become stigmatized. These include:

• Public Stigma: Where something causes the house becomes notorious as in the List case,
• Murder/ Suicide Stigma: When the event occurs inside the house or on the property but it hasn’t become notorious,
• Criminal Stigma: When the house becomes notorious for a criminal event…like being used as a brothel or known drug den,
• Debt Stigma: When the debt collectors repeatedly come to the home trying to collect, unaware that the debtors have moved on,
• Phenomena Stigma: You know…when the house shows up on an episode of Ghost Hunters

The Takeaway… In New Jersey, it’s still “buyer beware”. Sellers are not obligated to disclose stigmatizing events, so it’s up to you to do your homework and ask. As for sellers, I always counsel them to be prepared to share everything when asked. The truth WILL kill some deals…that’s the unfortunate reality of stigmatized properties. But it won’t kill EVERY deal! Be patient, have faith, and a deal will come together. 

A colleague once told me ”there’s a lid for every pot”. I agree. And there’s a buyer for every home…even a stigmatized one!

Tags: disclosure, home sellers, stigmatized

This entry was posted on Sunday, May 30th, 2010 at 6:30 am and is filed under Buyers, Real Estate 101, Sellers. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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