Updated 10/14/16, originally published 1/16/16
- The seller is required to disclose adverse information about the house. No, ghosts don’t count.
- The seller’s agent also must disclose anything they know about the home as required by law.
- Don’t rely on the seller’s disclosure when buying a house. Do your due diligence yourself.
Do you have to disclose if your house is haunted?
Not in Texas!
“Haunted Houses” are examples of what are called “stigmatized properties”. A stigma is a negative perception of something for reasons other than the actual quality of that something. The full definition of a stigmatized property is:
a property psychologically impacted by an event which occurred or was suspected to have occurred on the property, such even being one that has no physical impact of any kind.
There are some States that require disclosure if there is a known “psychological impact” on the property. Texas is not one of those States. The law in Texas is as follows:
SELLER’S DISCLOSURE OF PROPERTY CONDITION. (c) A seller or seller’s agent shall have no duty to make a disclosure or release information related to whether a death by natural causes, suicide, or accident unrelated to the condition of the property occurred on the property or whether a previous occupant had, may have had, has, or may have AIDS, HIV related illnesses, or HIV infection.
The law is pretty straightforward, actually. If the incident wasn’t a problem with the house, then it doesn’t have to be disclosed. (US judicial case law does not consider ghosts to be “property conditions”). Suicides = no. Murders = yes. Ghosts = no. Property related accidents = yes. The rule regarding AIDS/HIV is a housing discrimination issue, as it is related to a disability and therefore one of the seven protected classes.
How it Impacts Your Home Value
Of course, just because something doesn’t have to be disclosed doesn’t mean it can’t affect the home value. Historically, stigmatized homes are quite difficult to sell, even if there is nothing technically wrong with them. Particularly gruesome or infamous events can destroy the value of a property.
Here in Killeen is a perfect example. Fort Hood tore down the SRP Center and built a new one after the 2009 mass shooting that took place there. Other examples abound elsewhere. The “Amityville Horror” house owners had to drop the price nearly $400,000 when it was on the market in 2012. The apartment complex Jeffrey Dahmer operated in was demolished and is the lot is still vacant to this day. OJ Simpson’s home was razed and rebuilt. The JonBenet Ramsey home had a terrible time trying to sell.
Sellers Disclosure Forms
When listing a home, the seller is required to provide a written disclosure to the buyer (multi-family homes and foreclosures are generally exempt). The Texas Property Code actually has a list of items that must be accounted for, at a minimum. The Texas Association of Realtors and TREC also have its own disclosure forms for sellers to use.
In addition to the general sellers disclosure, there are additional forms a seller may provide like lead based paint disclosures (required for homes built prior to 1978) or information about septic systems.
What it means to agents
If you are the listing agent, be careful disclosing anything you aren’t required to! It may seem like a friendly thing to do, casually mentioning to a buyer that the seller listed the house because their mother passed away inside a month ago. But you may have just turned off a buyer who is wary of such things. And now you have failed to represent your client, the seller.
If you or your seller feel it is in their interest to disclose a non-material fact about the property not already covered on the Seller’s Disclosure, try using TAR-1412: Seller’s Authorization to Release and Advertise Certain Information. In fact, I use this form on every listing. I include the language for the MLS description, agent-to-agent notes, directions, and the seller’s reason for selling when the buyer inevitably asks. I have the seller sign it with the rest of the listing agreement.
On the other side, if you are representing the buyer and know of any information that might impact their decision, you must always share it with them.
In the end, if you are buying in Texas, the history of your home (and any current “non-material” occupants) is entirely up to you to discover for yourself! There are some third party websites that claim to provide information above and beyond what the Texas law requires (I’ve never personally used either), such as www.homedisclosure.com and www.diedinhouse.com.
Know any local ghost stories or haunted houses in the Fort Hood area? Please, please, please share in the comments below!