Stigmatized property

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In real estate, stigmatized property is property that buyers or tenants may shun for reasons that are unrelated to its physical condition or features. [1] These can include death of an occupant, [1] [2] murder, [1] [2] suicide, [2] and even the belief that a house is haunted. [3]

Contents

Controversy exists regarding the definitions of stigma and what sorts of stigma must be disclosed at sale. It is argued that the seller has a duty to disclose any such history of the property. This, in practice, falls into two categories: demonstrable (physical) and emotional. Local jurisdictions vary widely in their interpretation of these issues and occasionally contradict federal law.

Types of stigma

Many jurisdictions recognize several forms of stigmatized property, and have passed resolutions or statutes to deal with them. One issue that separates them is disclosure. Depending on the jurisdiction of the house, the seller may not be required to disclose the full facts. Some specific types must always be disclosed, others are up to the jurisdiction, and still others up to the realtor. [3]

The types of stigma include:

At least in the United States, the principle of caveat emptor ("let the buyer beware") was held for many years to govern sales. As the idea of an implied warranty of habitability began to find purchase, however, issues like the stigma attached to a property based on acts, "haunting", or criminal activity began to make their way into legal precedents. [6]

In Stambovsky v. Ackley the New York Supreme Court, Appellate Division, affirmed a narrow interpretation of the idea of stigmatized property. The court held that since the property in question was previously marketed by the seller as a "haunted house" he was estopped from claiming the contrary. The majority opinion specifically noted that the veracity of the claims of paranormal activities were outside the purview of the opinion. Notwithstanding these conclusions, the court affirmed the dismissal of the fraudulent misrepresentation action and stated that the realtor was under no duty to disclose the haunting to potential buyers.

A previous version of this article stated that serious illness (such as AIDS) is also a reason a property may become stigmatized, citing a Florida law that contradicts federal law. [2] [7] However, under federal fair-housing laws, persons with AIDS are considered handicapped and members of a protected class. The fact that an occupant of a property has AIDS does not require disclosure to a prospective buyer.

Several states have created specific statutes in the US adding "stigmatised property" verbiage to their legal code. [8]

Examples

Famous homes, such as those used in television productions or filmmaking, can also be stigmatized by increased traffic from fans wanting to see the house in person. One example is the house at 112 Ocean Avenue in Amityville, New York where Ronald DeFeo, Jr. murdered his family, later made famous by best-selling book The Amityville Horror and numerous film adaptations. The Lutz family claimed the house was haunted by evil spirits who drove them out. Their claims are supported by paranormal investigators such as Ed and Lorraine Warren and Hans Holzer, but dismissed as fraudulent by skeptics such as Robert Todd Carroll. [9] Since the film's release, the house has been renovated and the address changed in an attempt to prevent sightseers from disturbing the neighborhood.

Another example is the house at 74 Surfside Avenue in Montauk, New York that belonged to Norman Kean, a Broadway producer who killed himself in 1988 after stabbing his wife Gwyda Donhowe over 60 times. [10] Actress Tuesday Weld bought the house in 1990, but when Weld decided to sell in 2006, it took three years for her to find a buyer. In 2009, she finally sold it for about $2.25 million under asking. [11]

See also

Related Research Articles

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References

  1. 1 2 3 4 Tomei, Marilyn E. (Spring 1992). "ANSWERLINE: STIGMATIZED PROPERTIES" (PDF). Real Estate Bulletin. North Carolina Real Estate Commission. 23 (1): 5.
  2. 1 2 3 4 5 "Title XL > Chapter 689 > Section 25: Failure to disclose homicide, suicide, deaths, or diagnosis of HIV or AIDS infection in an occupant of real property". 2011 Florida Statutes. The Florida Senate. 2011. Retrieved November 17, 2011.
  3. 1 2 3 4 5 6 Reilly, John W. (2000). The Language of Real Estate. Dearborn Real Estate Education. pp. 312–315. ISBN   978-0-7931-3193-8.
  4. ↑ Stites, Jean (2004). Adventures in Real Estate. Lulu. p. 92. ISBN   978-1-4116-0560-2.
  5. ↑ "Can 'ghosts' cause bad air? Poor indoor air quality and 'sightings'".
  6. ↑ Pancak, Katherine A. (2004). Connecticut Real Estate Practice and Law. Dearborn Real Estate Education. pp. 194–195. ISBN   1-4195-0167-4.
  7. ↑ "Housing Discrimination Because of HIV/AIDS Is Illegal". The HUDdle. 2015-04-07. Retrieved 2017-09-03.
  8. ↑ Zygmunt, Raine (December 2003). "Stigmatized Property: Haunted Sales". REALTOR® Magazine. National Association of Realtors . Retrieved October 15, 2017.
  9. ↑ Carroll, Robert (2011). The Skeptic's Dictionary: A Collection of Strange Beliefs, Amusing Deceptions, and Dangerous Delusions. John Wiley & Sons. ISBN   978-1-118-04563-3.
  10. ↑ Freifeld, Karen (February 9, 1988). "Murder and Suicide — By a Thorough Man". Newsday.
  11. ↑ "Unsettling Facts About Tuesday Weld, The Teenager Who Survived Hollywood". Factinate. June 23, 2022.
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