You may think in the land of sunshine, surf and sand there can be nothing defined as stigmatized. Maybe not, since the word can mean different things to different buyers.
The National Association of Realtors refers to “stigmatized property” as a property that has been psychologically impacted by an event occurring on the property, even where there was no physical harm to the property.
The typical property that is considered stigmatized by events occurring there is one where a crime occurred. A violent crime is a problem for both buyers and sellers. Buyers may not feel comfortable buying the home since they might be uncomfortable living in a property with a violent history. Because of this, sellers may face the possibility of an adjustment to their price or a renovation to remove any reminders of the event. Two infamous stigmatized properties are the house in Fall River, Massachusetts where Lizzie Bordon is said to have murdered her father and stepmother in 1892. The Borden house has been turned into a tourist attraction for those with a macabre interest. And, of course, the most well-known murder home in the country is where actress Sharon Tate and four others were murdered by the Manson Family cult in 1969. The Los Angeles house was ultimately demolished and a new home with a different address was built in its place.
A price adjustment can depend on whether the property has any notoriety attached to the violent act, especially if the event was reported in the newspapers with details and police involvement. A death on the property, whether natural or suicide, is less of an issue to most buyers. Nevertheless, in the real estate market, we’re experiencing a shortage of available properties. Buyers may be willing to overlook many negatives, especially if the pricing is favorable.
Another potential problem for sellers is not necessarily a property stigmatized because of a death or violent act, but because it is out of the norm for the region. For example, something quirky about the property, whether it’s construction or decorating that can’t be easily removed.
One-of-a-kind architectural properties not compatible with everyday living, actual castles, or castle-like construction, and caves built into the side of a mountain are all examples of stigmatized properties. The problem here is the narrow market for unusual properties and the impact that may have on their value.
The National Association of Realtors goes on to say that selling a property with a reputation may be difficult. In Florida, state laws do not oblige a seller to reveal extraordinary occurrences such as a crime, suicide or unnatural death that occurred on the property or even cases where there are reported hauntings.
However, sellers and their agents would be advised to disclose all potential psychological negatives about the property. Hauntings might be a stretch to disclose but certainly, deaths of any kind could come back to haunt the seller if withheld.
That said, there are certain disease-related negatives that buyers may want to know about, like AIDS and COVID-19. This is a very gray area and may be considered a protected class and not able to be disclosed. This type of situation requires careful consideration and legal input if you are an owner getting ready to sell a similar property.
Like all discussions about disclosure, whether it’s water pipes or death, always best to be cautious and disclose. Grandma’s ghost and nasty sharks in Tampa Bay may be exceptions.
