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Boo! Must a Realtor® disclose if a house is haunted?

by Kelly Leighton on

While people may shell out a few dollars each October to visit a haunted house, would they want to live in one? And as a Realtor®, what if you’re trying to sell a supposed haunted house? Do you have to disclose that?

Earlier this year, the Supreme Court ruled in Milliken v. Jacono that Pennsylvania’s seller disclosure law does not require disclosure of stigmatizing events to a potential buyer. In the case, the court determined that a murder-suicide occurring in the home was not a required disclosure under the law.

So, what if a house has some, well, extra, uninvited presences?

“The law requires you to disclose physical defects,” said PAR’s Director of Law and Policy Hank Lerner, Esq. “A haunting is not a physical defect.”

However, Lerner recommends that if the previous owner had used the haunting for publicity, it is best to be upfront about a house that may have a reputation as the “ghost house.”

In one often-referenced case from New York, Stambovsky v. Ackley, Jeffrey and Patrice Stambovsky put a down payment on Helen Ackley’s home. While visiting the property, they heard of the rumors of the haunting. Ackley herself claimed in interviews to have seen ghosts, but didn’t mention it to the Stambovskys.

Once the Stambovskys found out about the uninvited residents, they sued to get their down payment back. They initially lost the case, with the trial court ruling they should have done the research. They appealed and the New York Supreme Court, Appellate Division, ruled in their favor in a 3-2 decision. They received a refund of their down payment.

Therefore, Lerner recommends telling potential buyers about potential hauntings in some way.

“Even if it’s not a legally required disclosure, you can really save yourself a few headaches – and more than a few dollars in legal costs,” he advised.

Topics

Listings Real estate Halloween Milliken v Jacono Haunted Haunted house Physical defect
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Comments (5)

Comments

  • Tom Edkin    October 31, 2014 | 9:38 am

    Had an older home for sale with the old pushbutton light switches…springs weaken and contacts oxidize, especially when vacant. Potential buyers wanted it checked out by a “medium” (“We noticed lights flickered and we had previously lived in a home with spirits…it was a nuisance.”) I made an appointment with the medium, got there early and sprayed the switchboxes with contact cleaner. Turned them on and off a few times. Lights didn’t flicker. Medium declared home “spirit free.”

    Reply to Tom Edkin
  • Wendell Stockdale    October 31, 2014 | 11:26 am

    If you the Realtor® disclose the that the house is haunted and the buyer reneges (because of your disclosure), might not the seller have a case against you because you were not required to make the disclosure?

    Reply to Wendell Stockdale
    • Hank Lerner    October 31, 2014 | 12:13 pm

      Great question, Wendell. In this sort of situation the agent shouldn’t be making a disclosure like this on his or own initiative. A listing agent who comes across something in the listing process (like, say, a seller who says “the neighbors say my house is haunted!”) should discuss it with the seller and come to a decision together as to what will be disclosed and how. That conversation would usually include the agent reminding sellers of the plusses and minuses of the disclosure, and like any of these topics you’d want to have something in writing to show that the seller instructed you to do or not do certain things.

      For example, it might be good to point out that while more disclosure might result in a buyer not buying, it also prevents a buyer who feels they’ve been mislead from suing after the fact. In the Milliken case referenced in the article the seller was legally correct to not make a disclosure, but it likely cost many tens of thousands of dollars in legal fees to get that court ruling.

      Reply to Hank Lerner
    • Ron Woytowich    October 31, 2014 | 11:45 pm

      Wendell… which is exactly why I have a conversation with the seller. If the seller does not want to disclose it, I do not want the listing or the liability. More importantly, I do not want the burden of causing a buyer to regret their decision on something that might be important to them. I would not want to find out after the fact that a home was stigmatized by an unnatural death, haunting or other similar issue. Some folks do not have a problem with it, my conscience just would not let me do it.

      Reply to Ron Woytowich
  • Ron Woytowich    October 31, 2014 | 9:58 pm

    I feel it is always better to disclose in our overly litigious society. Having sold a home that had a suicide in it, I could not with good conscious not disclose that. There is the law and there is the Golden Rule. The buyer was okay with it, and there was an addendum to the agreement of sale signed by the buyer. Some people are more concerned about things like this than others, it is not my right as an agent to make a judgment call like that. When I found out about it, my seller agreed that we needed to disclose it, otherwise, I would have referred the listing out.

    Reply to Ron Woytowich

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