Stigmatized Properties – What are they?

Stigmatized properties are those properties that have an unfavourable quality that may make a buyer uncomfortable.  The stigma is not related to the quality of the property.  For example if a suicide has occurred in the home, buyers may be uncomfortable purchasing it.  The same is true for a home where someone has been murdered or a home where a major crime has taken place.  Reports that a house is haunted may constitute a stigma.

The law does not require a seller to reveal any possible stigmas however if a buyer asks a direct question related to a property the seller or the agent must reveal the situation.

If you are buying a property and if you have serious negative thoughts about a possible stigma, you should ask the Realtor if a death or crime has occurred on the property.  It then becomes the responsibility of the Realtor to inform you of the truth of the situation.  It is likely that the neighbours will freely discuss the possible stigma of a specific property, it might be a very good strategy to talk to your possible new neighbors and a casual question about a stigma may be your best option.

If you are a seller of a stigmatized property you are not obligated to inform buyers of any stigmas that may affect your property.  However if a buyer asks a specific question about the existence of a stigma the buyer is again obligated to answer truthfully.  Whether you answer the question or if you decide to disclose the stigma that may exist around your property you can be reassured that at some point the new owners are going to find out.  In many cases there will be no consequences, however in the event there are some serious objections on the minds of the buyers it is always best to disclose everything to the buyer.  It is these types of situations that can lead to inconvenient lawsuits and  relation ships.