"There are two types of stigmas in real estate: physical and psychological," says Barbara Nichols, a Beverly Hills Realtor and the author of The No-Lawsuit Guide to Real Estate Transactions. "Physical stigmas are homes in an airport flight path or in an area of landslides or subsidence. Psychological stigmas are related to deaths on the property, ‘haunted’ homes or homes where a previous owner had a notorious reputation, such as an organized crime boss."

Finding out if the property you are considering has a sordid past may not be easy. The laws regarding disclosures on stigmatized properties vary from state to state, which can be a problem for a vacation home owner. "If you’re used to buying property in your home state, you may not be as accustomed to the disclosure laws that pertain to your home purchase elsewhere," says Nichols. (Click image to enlarge)

One of the problems with stigmatized homes is that what may be an issue for one buyer will not necessarily affect another. "People from some cultures would never consider buying a home where someone died, even if it was a natural, uneventful death," says Lorrie Beaumont, a real estate appraiser based in Westwood, Massachusetts. "Then there are buyers who don’t bat an eye when told that a house is being offered at a discount because it was the site of a double murder; instead, they want to sign the deal right away."

Figuring out the true price of a stigmatized home is also an issue. "There’s a great deal of research involved," says Beaumont. "Basically, an appraiser starts by trying to find a similar home where a crime or event has occurred and see how that has affected the sale."

Neighborhoods can also be stigmatized by a crime or an unsavory resident. "If the home you buy is up the street from a famous murder scene, you may have tourists walking or driving past you to take pictures of the house," says Nichols. "And today, it’s easy for anyone to search the Internet to see where registered sex offenders live. What if one is living two doors down from you? Would that affect your selling price?"

Nichols recommends spending extra time researching a home purchase to look for potential stigmas. "Speak directly to your real estate agent about what he or she is required to disclose, and ask about the neighborhood as well. Be suspicious about a property that is offered for less than comparable homes for no apparent reason."

Contact:
	Lorrie Beaumont, 781.326.3521, www.appraisers.org Barbara Nichols, 310.273.6369, www.barbaranichols.net