Unless you ask a seller point blank, you are unlikely to find out
whether their home was the scene of a murder, suicide, grow operation, or if
there’s been water damage or flooding.
Most would agree that this type of information would affect the
value of the property. Here’s an example. A house at 934 Ossington Ave. in
Toronto took 16 months and multiple listing agents before it sold in 2013 for
less than the list price during one of Toronto’s hottest real estate markets.
The property was the site of the murder of Allan Lanteigne on March
3, 2011. Lanteigne’s husband, Demitry Papasotiriou, 32, was later arrested and
is charged with first-degree murder. The case has yet to come to trial.
The property was listed eight months after the murder for $973,000
and finally sold for $900,000.
If a real estate agent knows about a murder, they are obligated to
disclose this under their Code of Ethics as a material fact. The problem is if
the agent doesn’t know about it, there is nothing to disclose.
More and more people are turning to the Internet to try and find
answers. Tenants are checking bedbugregistry.com to make sure the building they are interested in has not been
reported as having a bedbug problem. Buyer and real estate agents are going toHomeverified.ca and Iverify.com to see whether a property was ever listed as a grow-op or meth lab
and whether a prior owner had made an insurance claim on the property for fire
or water damage, or sewage backup.
A new website developed by Toronto-based brothers Robert and
Albert Armieri is called www.housecreep.com, where
visitors can enter an address and see whether a crime was committed on the
property. The brothers claim they got the idea while checking the bedbug
registry while apartment hunting.
The website claims to have a database of more than 2,000
properties and invites other parties to share information about properties.
Users should beware that some of the information may not be
accurate and should be independently verified. Realtor Barry Lebow, who has
also been an expert witness on the subject of stigma, recommends buyers do
their own online search to find news reports about particular addresses.
I recommend buyers insert a clause into any agreement stating that
the seller is unaware of any issues relating to murder, suicide, grow-ops or
insurance claims about their property. In addition, speak to the neighbours.
You are likely to hear from someone if there was a problem in the past
affecting the property.
A real estate agent called me the other day and told me a client’s
husband died recently and his wife sprinkled his ashes in the back yard. The
agent wondered if she needed to disclose this to potential buyers. I asked her
whether it had been windy that day.
With more and more information available on the Internet, I
encourage sellers and real estate agents to disclose these types of property
stigmas. It will come out eventually. Who needs to go to court to fight about
it later?
Mark Weisleder is a lawyer, author and speaker to the real estate
industry. You can contact Mark at mark@markweisleder.com
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