Office: 165 Pretoria Avenue, Ottawa ON. K1S 1X1
Unless you ask a seller point blank, you are unlikely to find out whether their home was the scene of a murder, suicide, grow house operation, or whether they experienced water damage or flooding in the past.
Most would agree that this type of information would definitely affect the value of the property if known. An example in Toronto took 16 months and multiple listing agents before it sold in one of the hottest real estate markets. The property was the site of a murder on March 3, 2011. A suspect was arrested in 2012 and was charged with first-degree murder. The property was originally listed eight months after the murder for $973,000 and finally sold for $900,000 in 2013.
If a real estate agent knows about a murder, they are obligated to disclose this under the Code of Ethics as this would be considered a material fact and they have an ethical obligation to disclose material facts to unwary buyers. The problem is, if the agent doesn’t know about it, there is nothing to disclose.
More and more people are turning to the internet to try and find the answers right now.
Tenants are checking bedbugregistry.com to make sure the building they are interested in has not been reported as having a bedbug problem. Buyers and real estate agents are going to Homeverified.ca and Iverify.com to see whether a property was ever listed as a grow house or meth lab and whether a prior owner had made an insurance claim on the property for fire or water damage, or sewage backup.
A new website developed by Toronto based brothers Robert and Albert Armieri is called www.housecreep.com, where visitors can just enter a property address and see whether a murder or crime was committed on the property, including whether it was a grow house. The brothers claim they got the idea while checking the bed bug registry online while apartment hunting.
The website also shows famous people who lived at properties. For example, Carrie Underwood and Mike Fisher used to live at a premium address in Ottawa, presumably when Fisher played for the Senators. The website claims to have a database of over 2,000 properties and it is growing every day. The website invites other parties to share information about properties as well. They then try to verify everything through newspaper reports.
Users should beware that some of the information may not be accurate and should be independently verified. Realtor Barry Lebow, who has also been an expert witness on the subject of stigma, and confirms that a past murder will affect property values, recommends that buyers should conduct their own Google, Safari and Yahoo searches to verify anything they see on this site.
In addition, I recommend buyers should insert a clause into any agreement stating that the seller is unaware of any issues relating to murder, suicide, grow ops or insurance claims about their property. Speak to the neighbours as well. You are likely to hear from someone if there was a problem in the past affecting the property.
A real estate agent called me the other day and told me that the husband of a client died recently and his wife sprinkled his ashes in the back yard. She asked if she needed to disclose this to potential buyers. I asked her whether it had been windy that day.
With more and more information becoming available on the internet, I encourage sellers and real estate agents to disclose these types of property stigmas. It will come out eventually. Who needs to go to court to fight about it later?
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