With spooky season around the corner, haunted houses and other chilling structures are always at top of mind. In the world of real estate, stigmatized properties are the go-to topic. 

What is a stigmatized property?

A stigmatized property is a perceived condition or occurrence that is associated with the property, not the actual structural livability of the property.

Stigmatized properties can hold a stigma due to several factors, such as:  

• Murder or suicide;
• Regular criminal activity, including grow-ops or sex work;
• A death in the home from natural causes;
• Reports of haunting or paranormal activity; or
• Next to cemetery or burial ground.

What role does a REALTOR^® play when disclosing information?

REALTORS^® who work with stigmatized properties are faced with real challenges around what to disclose, how to manage the expectations of both buyers and sellers, and how to cope with their own feelings and issues around grief and death.

“As a REALTOR^® representing buyers, it’s your duty to ensure you verify with the seller’s agent whether a property of interest is free from any buyer-identified stigmas. As a seller’s representative, you’re required to get those answers from your seller and follow the seller’s instructions on disclosing this information,” says Allison Kimmins, Manager of CREB^® Member Practice.

Top tips for REALTORS^®

1. Consider your personal care – For some REALTORS^®, working with a stigmatized property can be a difficult emotional experience. If you're not emotionally comfortable with it, don't be afraid to co-list the property with a colleague.
2. Understand what is and isn’t a material latent defect – If a property has a substantial defect that cannot be discovered with reasonable care during an inspection, that is a material latent defect. However, stigmatized homes do not automatically qualify as having material latent defects, as the impact perceived is subjective not structural.
3. Know what to disclose – In Alberta, stigmatized homes do not have to be disclosed by law and there are no obligations to put that information on the MLS^® System. We recommend considering the Real Estate Insurance Exchange's (REIX) position on disclosing stigmas and getting your seller’s instructions in writing on how to disclose them.

To read more about stigmatized properties click here.

If you have questions about stigmatized properties, please contact CREB^® Member Practice at crebmp@creb.ca for more information.