Real Estate Disclosure Rules: Hauntings, Ghosts, Ghouls, Murders, and Suicides

Haunted House

Real estate disclosure rules are quite clear and extensive for physical property characteristics, but there is a little more gray area around homes that could be haunted or the site of a death. If you are selling, what do you have to tell the buyer, and what can you keep quiet? The answer, it turns out, depends on your state.

New York Real Estate Disclosure Rules: Haunted Homes

In 1990, New York Supreme Court ruled on the case Stambovsky v. Ackley, often referred to as the “Ghostbusters Ruling” after the Ghostbusters movie that had just been released five years prior.

Helen Ackley was the previous owner of the property, and had reported to national publication Readers Digest and local newspapers. She claimed that the home was haunted by several poltergeists, and that the spooks had directly interacted with members of her family.

But neither Ackley or her real estate agent discloses that fact to Jeffrey Stambovsky, who purchased the home from Ackley. Stambovsky just moved to the area, just across the river from Sleepy Hollow, from New York City and was not aware of the local legends around the property. Upon learning the information, he asked that the sale be rescinded.

The Court sided with Stambovsky. Whether the house truly had ghosts was not decided, but because the story was nationally published, it should have been considered material and disclosed to the buyer.

Where, as here, the seller not only takes unfair advantage of the buyer’s ignorance but has created and perpetuated a condition about which he is unlikely to even inquire, enforcement of the contract (in whole or in part) is offensive to the court’s sense of equity. Application of the remedy of rescission, within the bounds of the narrow exception to the doctrine of caveat emptor set forth herein, is entirely appropriate to relieve the unwitting purchaser from the consequences of a most unnatural bargain.


Real Estate Disclosure Rules: Murder

According to Investopedia, the rules vary widely depending on the state. In Texas, for example, accidental death, suicide, and homicide must be disclosed. Georgia, on the other hand, does not require disclosing such incidents.

However, it may be wise to disclose a death even if not required. The buyer may find out eventually, and if the information proved to be material for resale value, they can sue for damages. They may not win, but the legal risk is still there and the costs to defend from even a frivolous suit can be quite high.

No states require disclosing a death under natural conditions, but any other death should be disclosed to protect yourself from future suit. If in doubt, talk to your agent or an attorney.

A Quality Agent Guides You The Right Way

Whether you live in New York, Texas, Georgia, or anywhere else in the United States, knowing the right things to share and keep quiet can be complicated. That is why real estate agents are here. It is their job to know the rules and laws to make sure buyers and sellers stay out of trouble.

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