When looking to acquire a new property, investors will no doubt hear about the sticking windows, the old furnace and the leaky faucet – but what about the ghost that roams the halls of the house?
“The most famous case [regarding disclosure of haunted houses] in North America is called the Ghost of Nyack in Nyack, New York,” says Barry Lebow, an expert in stigmatized properties, adding that agents must always disclose a supposed haunted house.
“A real estate agent was sued over it. You don’t have to believe [the property is haunted], the public has to believe it. That’s the only case of its kind in North America.”
In this case, homeowners did not disclose to buyers the fact that their 5,000-square foot home was haunted – a belief that was also commonly held throughout the community. Lebow says public perception is all it takes to stigmatize a property as haunted.
“A lot of times, it’s just word of mouth that makes a house haunted,” says expert Barry Lebow. “Word of mouth is the most dominant thing in stigma.”
There are similar perception-based laws in Canada. The presence of urea formaldehyde, for example, has the ability to stigmatize a house.
“There are no associated health risks but it stigmatizes these houses,” Lebow says. “[The general public] perceive it to be unhealthy.”
Still, there are buyers who are unconcerned with supposedly haunted houses, and there are others who would never step foot into a spirit-infested home. The trick for agents, Lebow says, is determining whether or not a property is stigmatized.
“In Canada, there are millions of houses,” he says, “and the question is, how many are labeled as haunted?”
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