Stigmatized Property in Real Estate

Stigmatized Property in Real Estate

Hi there. Are you curious about
stigmatized properties and what that means when it is time to buy or sell? In
today’s video we are talking about stigmatized properties and real estate. Let’s explore this potentially spooky topic. Hi, my name is Emily Farber and I’m a
Realtor® with Lepic-Kroeger, Realtors® in Iowa City, Iowa. Today’s video is all about
stigmatized properties. What is a stigma? What do sellers need to disclose in the
state of Iowa? And, how do buyer’s protect themselves if they have concerns about
stigmatized properties? You may be wondering, “What is a
stigmatized property?” A stigmatized property is a piece of real estate that
has a stigma attached to it by the general public.
Stigmatized properties in real estate are those that society has found to be…
shall we say… undesirable because of an event that occurred there, or because of
the house’s proximity to a known nuisance. Some common examples of stigma in real
estate include: a death in the house, be it natural, homicide or suicide. Criminal
activity on the property. Public stigma. Rumors of haunting, or even nearby sex
offenders. If a house is old enough chances are likely that somebody,
somewhere, over the course of the house’s history, has died in the house. In fact I
think it’s even becoming more common as people want to live their final days in
the comfort of their own home. Some states have laws governing the
disclosure of such stigma as part of the sellers property disclosure. Others do
not. Iowa is a state that does not require
seller disclosure of stigma. The National Association of Realtors®
requires that Realtors® voluntarily disclose any known facts
that could affect a reasonable purchaser’s decision to buy. As as a quick
review here is what a material fact or a material defect is: A material fact is
considered adverse when it involves a condition or an occurrence that is
recognized by a competent licensee as significantly and adversely affecting
the value of a property. Significantly reducing the structural integrity of the
improvement of real estate. Presenting a significant health risk to the occupants
of the property. The sticky wicket is that what is considered a material
defect by one buyer may not be considered a material defect by the
seller. What one person may consider to be a total deal-breaker
may be inconsequential to the next. And that, my friends, is why the state of Iowa
does not require sellers to disclose stigmas on their sellers property
disclosure. While nobody wants to disclose that sad or horrible things may have happened
in the house, it’s not the house’s fault that those things happen there. However, if you are
concerned about your legal liability and a potential buyer finding out about it
after the fact. (Which they always do…neighbors talk.) You should disclose. That way you have all of
your bases covered and nobody can come back and claim that you hid important
information from them. It is always preferable to lose a buyer who is going to be unhappy with the condition, physical or psychological,
of your house and search a little bit longer for someone who is truly thrilled
to have the opportunity to buy our house. Some good ways to research the property if you are
concerned about potential stigma are websites like which is a
pay for service website that searches public records for notice of death at
certain addresses. Another good resource is to check with your local police
department and check crime reports for the area. If you are especially concerned
about just the whole neighborhood vibe you may want to go knock on some
neighbors doors and see what they have to say about the neighborhood and the
house in general. All right, in all seriousness, would you
ever consider buying a house in which somebody had died? Leave me a comment
down below because I’m curious. Hey, don’t forget to subscribe, and remember to ring
that bell, that way you’ll be notified every time I put out a new video, which
by the way, is every Friday. It’s been fun! Thanks for joining me.


  1. Post
    Wise Move AZ

    You didn't introduce your new dancing partner! 🤣 it sounds like the rules are very similar between our two markets regarding disclosure.

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    Amy Hayslett Realtor

    When clients ask should we disclose…… The answer is almost always yes. One client buried the dog in the back yard. It was disclosed.

  4. Post
    Amy Hayslett Realtor

    Oh and with my first house I learned that the very first owner died there. It had had other owners since then. I didn't care and I don't remember if it was disclosed. I did have probate house where many potential buyers asked the question so it is important to some people.

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    Theresa Wellman - Realtor Homeowner Experience

    Love the topic and timing! Cute dancing partner! Interesting Iowa does NOT require disclosure of death. But good advice to disclose anyway to minimize risk of issues after close of escrow. Love the advice to talk to neighbors!

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