Many people have never heard the term “stigmatized property” before. But if you are either buying or selling a piece of real estate, it could be important to understand what it means.
A property can become stigmatized if any one of a number of adverse events occurs there, or sometimes even in proximity to its location. Perhaps the most common example of a stigmatized property is a home or business where there was a murder or suicide.
Below are some events or activities that can stigmatize a property:
- Public intrigue – Think the Albuquerque home of the fictional Walter White of “Breaking Bad” or the family home from “The Sopranos” in Caldwell, NJ. Fans of the shows wanting a glimpse of the properties can make a new homeowner’s life miserable.
- Paranormal activity – You might not believe in ghosts, but what happens if you wind up with one as an unwelcome roommate?
- Criminal activities – Were the former occupants manufacturing meth in the bathroom? Or maybe the former owner was a sports bookie? The buyers could be in jeopardy from criminals searching for their next fix or to collect a debt.
These are just a few ways that a property can get stigmatized — and thus, be harder to sell.
What Ohio laws says
Unlike some other states, Ohio doesn’t have any mandatory disclosure laws about deaths or other stigmatizing events that occurred in the past in or around a property. But that doesn’t get sellers or the real estate agents that represent them off the hook entirely. That’s due to potential issues of fraud if a buyer presents credible evidence that the nondisclosure constituted a material defect.
What’s the bottom line? Buyers and sellers should protect themselves legally during any real estate transactions they make to avoid trouble haunting you down the road.