Disclosure law dictates what homeowners have to tell potential buyers about their property. If your home has been the site of a murder - either recent or historical - you might be wondering whether you're obligated to note this as part of your disclosure. Similarly, some people are convinced their homes are haunted - is that something you need to warn homebuyers about? Here’s what you need to know.
Which states require you to disclose a house murder?
About 20,000 people are murdered in the U.S. every year - and even more die of natural causes, but there are only a few states that require you to disclose a murder. In Alaska and South Dakota, you only need to disclose a suicide or murder if it happened within the past year. In California, you need to disclose all deaths - but only if they happened in the past three years.
In other words, there’s often a fairly quick time limit for disclosure - so if home buyers really want the macabre dirt on their potential property, they might be better off researching it first. For $11.99, the site diedinhouse.com will scrape nearly 120 million public and private records in order to let you know your home's morbid history.
In other states, sellers need to be forthcoming about it if the buyer asks - but they are otherwise off the hook and not required to voluntarily disclose. Because property disclosure is determined state-by-state, many states have slightly different expectations of what sellers need to do - your agent will be your best asset for making sure you've filled out your disclosure document properly.
Do you have to disclose a death in a house?
After someone dies, their family is often tasked with selling their house - and if their loved one died at home, they may be wondering how this impacts disclosure. If a death occurs because of natural causes, only California requires voluntary disclosure - and only if it happened in the last three years.
Are Realtors required to disclose deaths? Realtors follow the same disclosure laws that home sellers do. So in most cases, Realtors will not be required to tell you about a natural death on the property. According to Apartment Therapy, in most states (36) agents don’t need to disclose a death - but they must be honest with what they know if the home buyer asks.
Why don’t sellers have to disclose a murder?
You might be wondering: exactly why is it that sellers usually don’t have to disclose a murder? It might help to look at the case of Milliken v. Janoco, which was brought to Pennsylvania’s Supreme Court. In this case, a family (the Janocos) bought an auction home as a fixer-upper after a horrific murder/suicide had taken place there just seven months prior. Less than a year later, the home was re-sold to Janet Milliken.
After hearing about the grisly event from neighbors, Milliken sued both the seller (Janoco) and the brokerage involved for failing to disclose the stigma surrounding the home - arguing that because psychological stigmas reduce property value, sellers should be compelled to list them in the PA property disclosure.
The Supreme Court disagreed, however. First, they noted that this could set an incredibly difficult precedent since every person defines psychological stigmas differently, and traumatic events can’t be weighed against each other. What if no murder had taken place there, but a well-known murderer had lived there? What if there was never a murder, but children had been abused in the home? And if so, how long does a stigma last - 5 years? Or 20? The scope would be impossibly wide.
In other words, the court decided that requiring home sellers to guess at the psychological toll of various events - and risk a lawsuit if they didn’t think to mention them - would place an unmanageable burden on sellers, and be difficult to apply fairly by courts on a case-by-case basis.
Beyond that, the court upheld that the PA disclosure form’s intent is to inform buyers of physical defects of the property that could directly impact the quality of the home or create unreasonable risk. In the court’s eyes, psychological stigma - while unpleasant - doesn’t actually impact the home’s physical structure, which is the point of the disclosure form.
Are murder homes cheaper?
Although you might assume that murder homes are cheaper, the greatest discounts to be had are for the most well-known cases. Property appraiser Randall Ball was responsible for appraising some of the country’s most infamous crime homes, including the site of the Manson family murders and Jon Benet Ramsey’s home. He says that in his experience specializing in stigmatized homes, the drop in property value can really vary - but in general, one can expect these homes to sell for 10-25% less than they would normally.
University of Technology Sydney researchers found that even homes in the nearby area were impacted. They discovered that U.S. housing prices within 0.2 miles of a murder house take a 4.4% hit in the year following a homicide, with less of a drop the year later. And an earlier study, by Wright State University, found that stigmatized homes were on the market for 45% longer than comparable properties.
Finder.com took the data from UTS and broke it down into a state-by-state summary of just how much murders had the potential to impact property value. California, New Jersey and New York saw the biggest impact due to homicide. California alone experienced a potential home value drop of $17,472 per home, and an estimated total market loss of $566,664,412.
For homeowners trying to offload a stigmatized home, there’s a silver lining here: time is an asset when it comes to regaining lost property value. Instead of taking an immediate profit hit by going to market, these potential sellers should consider renting the property out for a year or two - then selling.
Do you need to disclose ghosts?
What happens when the dead become the not-quite-dead? Only four states currently reference paranormal activity in their disclosure laws for home sellers: New York, New Jersey, Massachusetts, and Minnesota. However, even in these states a homeowner typically only needs to disclose the home’s haunted reputation if asked - they don’t need to volunteer this information unprompted.
“In Maryland, a home being haunted is not a material fact and does not need to be disclosed, nor is a murder having taken place or a previous owner having died in the property,” explains June Piper-Brandon, a listing agent for Greater Baltimore.
In New York, sellers are required to disclose ghostly roommates to buyers only if they’ve shared their opinion “with the public at large.” This was established by the case Stambovsky v. Ackley - which has come to be known as the “Ghostbusters ruling.” The defendant had shared the home’s reputation as a poltergeist haven with both local newspapers and Readers’ Digest.
Zillow has a more extensive, state-by-state list of disclosure laws as they pertain to paranormal activity that’s worth checking out. In many cases, your best bet for avoiding haunted houses is to pay attention on your initial tour - and perhaps chat with the neighbors.
Interestingly, Realtor.com conducted a study and found that an incredible 40% of people believe they’ve lived in a haunted house at one point. And - proving that homebuyers are willing to settle on some things if it means getting others - a full 33% were fine with living in a haunted house if it was cheaper, came with a bigger kitchen, or was in a more desirable location.
Should you buy a crime scene home for sale?
If you can stomach the home’s history, then a “stigmatized home” can potentially spell a good deal for you. It’s also worth considering that the longer you stay in the home, the fewer people (especially potential buyers) will associate it with its sordid past.
It’s also worth considering that many homes - especially older ones - likely have had people die naturally in them, and most new homeowners are simply none the wiser.
However, if you’re buying a home where a highly publicized crime took place, keep in mind that you could be signing yourself up for unwanted visitors - and not necessarily of the spooky variety. Trespassers and nosy neighbors could be a thing for years to come.
For further reading
