Part 1 of 3
Do You Need to Tell a Buyer Your House Is Haunted?
|Alejandro Rojas
http://www.huffingtonpost.com/alejandro-rojas/do-you-need-to-tell-a-buyer-your-house-is-haunted_b_8435418.html/
So you want to sell your house, but it is haunted and you are worried that will dissuade potential buyers. You may be tempted not to tell them. Heck, most people don't believe in ghosts anyway, right? Believe it or not, that strategy did not work out for a seller in New York.
I am a real estate agent in Arizona and this topic actually came up in my real estate training class. The instructor, Marty Baum of the Chandler Real Estate Training Center, said you don't have to disclose a potential ghost, but you do have to disclose a haunting. Furthermore, he claimed this was a topic that has been debated at real estate conferences he has attended.
I wasn't sure if he was kidding or not. However, after I looked into it further I found out he is right.
Rules vary state by state, but as we learned in class, according to the Arizona Department of Real Estate, "Sellers are obligated by Arizona common law to disclose all known material facts about a property to the buyer."
A material fact is a piece of information important to making a decision.
So what the heck is Marty talking about when he says you don't have to disclose if your house may have a ghost?
According to Arizona law, when it comes to real estate sales and leases, a seller does not have disclose if the property is "The site of a natural death, suicide or homicide or any other crime classified as a felony."
Marty's point is that if someone dies in the house, you don't have to disclose that information. He is then applying some comedic liberty to translate that as you don't have to disclose a potential ghost.
However, a haunting could be seen as a material fact. Such was the case in a famous New York court case, commonly referred to as the Ghostbusters ruling.
The case was Stambovsky v. Ackley. In 1990, Jeffrey Stambovsky went to the courts to get out of a contract he had made on a house that he later found out was haunted. The house was a Victorian in Nyack, New York, just across the Hudson River from Sleepy Hollow.
According to a story in The New York Times, Stambovsky was buying the home for $650,000 and had put down $32,500. He found out about the house's haunted reputation and refused to close on the sale and wanted his deposit back.
The first ruling was not in his favor. However, he appealed and won. The case was settled in 1991, and according to an alleged accounting of the affair by Ackley's son-in-law, eventually a judge decided that they split the down payment.
The question is, why did the court overturn the original ruling?
In New York, they followed the caveat emptor rule. This means "buyer beware" and puts the responsibility on the buyer to get the house inspected for defects. However, the courts ruled that an inspection would not have discovered the haunting. Apparently, they do not carry around the little device with all of the lights on it that was used in the movie Ghostbusters to look for ghosts.