While a property’s poor reputation can deter some potential buyers, there are others who intentionally seek out homes with a bad history because they see an opportunity for a bargain. According to the National Association of Realtors (NAR), real estate agents are required to disclose certain defects of a property or the materials used in its construction. However, whether or not a death occurred on the premises often depends on the state; in most states, death is not considered a significant defect that must be disclosed.
NAR notes that properties can be affected by what they call “stigmatizing events,” which can include incidents like murder, suicide, hauntings, or the previous owner’s unsavory reputation.
Disclosure requirements vary from state to state. California is the only state that mandates real estate agents to disclose all death information regarding the property. In Alaska, agents must disclose murders and suicides that occurred within the past year. South Dakota requires the disclosure of any death within the last 12 months, while New York does not require the disclosure of death events but does require agents to inform potential buyers if the property is haunted.
Homebuyers often need to take the initiative to ask agents about the property’s history. In states like Georgia, for example, agents or sellers are not required to proactively disclose if a death has occurred on the property, but they must answer honestly if asked by potential buyers.
Harrison Beacher, managing partner at Coalition Properties Group in Washington, D.C., emphasizes that, aside from specific state disclosure laws, listing agents also owe a fiduciary responsibility to their sellers. He states, “If someone asks me about this, I will point them to resources where they can find the answers, but I am not obligated to provide detailed explanations.”
Experts recommend two initial steps before purchasing a home in order to uncover its historical background:
1. **Talk to Neighbors and Officials**: Neighbors can offer firsthand insights about the area and information regarding previous homeowners. Additionally, reaching out to the county manager can help determine if there are any criminal records associated with the property you’re considering.
2. **Research Relevant Documents**: Online searches can yield a wealth of information. Any police reports concerning the property are public records and may be documented in newspapers, all of which is available for free.
Daryl Fairweather, chief economist at online real estate brokerage Redfin, points out that while some buyers might shy away from homes with a tarnished reputation, many others actively seek out such properties for the lower price tag. In fact, data shows that 72% of prospective buyers would be willing to purchase a “haunted house” if it came at a discount.
