So maybe selling a “haunted” house does make it more valuable?

December 27th, 2013

Remember Stambovsky v. Ackley? That’s the case where a New York court held that a house being “haunted” was a latent defect that the seller had a duty to disclose. One the arguments the judge relied on, in his farcical opinion, was that a haunted house was less valuable. I often ask my students if anyone would purchase a haunted house. Most say they wouldn’t care. But a few are adamant and would not. And there’s always one or two that would want to buy the house! Like Beetlejuice or something.

Zillow, which is apparently also a contributor to Forbes, writes about a guy in Pennsylvania who listed a house as “slightly haunted.”

haunted-house

slightly-haunted-home-682x1024And wouldn’t you know it. People were interested!

“I went back and forth,” Gregory Leeson says when asked about listing hisDunmore, PA home as “slightly haunted” on real estate website ZillowZ -3.69%. “I thought I might as well. I didn’t think it would generate this much interest.”

But since uploading his for sale by owner listing on Sunday, Leeson has received multiple offers and interest from buyers as well as ghost hunters across the country. The home has also ignited a growing discussion on Twitter, with many sharing their own haunted home stories:

Leeson’s somewhat tongue-in-cheek description of his home, which is listed for $144,000, begins by pointing out typical features — 4 bedrooms and 2.5 bathrooms — before delving into the property’s more unusual characteristics:

“Slightly haunted. Nothing serious though,” he writes in the listing. “The sounds of phantom footsteps. A strange knocking sound followed by a very quiet (hardly noticeable, even) scream.”

Pennslyvania, unlike New York does not require the disclosure of”psychological” defects.

“The courts in Pennsylvania have limited the defects that must be disclosed to impairments that are structural, legal or hazardous in nature,” he said. “Knowledge of psychological impairments such as deaths, murders and haunted houses are not required … however some legal experts recommend sellers disclose them anyway just to be safe.”

DeFazio recommends full disclosure, as leaving out potentially alarming information about a home can result in a drawn-out lawsuit, as seen in the case of Janet Milliken, a Pennsylvania resident who sued the seller and listing agent of her home for not disclosing a murder-suicide that took place there a year before she bought it. And in some cases, such as a home where a famous person died, DeFazio says full disclosure can have a positive effect on resale value.

But with haunted houses, DeFazio says it’s a gray area.

“Even if the court says yes [a haunting] is a material defect, you have to prove it actually exists,” he said.
“And how are you going to prove it? Call Ghostbusters?”

And the guy was trying to avoid law suits!

DeFazio suspects Leeson disclosed the home as haunted out of an abundance of caution to get ahead of a lawsuit that would likely never happen — or just to be funny.

Leeson says it was more the latter and that he had no knowledge of the state’s disclosure laws when he posted the listing.

“The way I worded it – I was trying to keep it light,” he said. “I don’t know the laws here, but I thought ‘better safe than sorry.’”

Anyway, here is some more information about the house in Stambovsky.

The New York Times and Atlas Obscura have good articles about the Haunted House.

The Ghost of Nyack | Atlas Obscura

The Times writes:

The phones have been ringing at real-estate offices in Rockland County. A patient in a psychiatric hospital called. So did a para-psychologist from Florida. And so did the Amazing Kreskin, all the way from his hotel room in Atlantic City.

That turreted turn-of-the-century Victorian house in Nyack is back on the market – the one that the owner says has not one, not two, but three ghosts. The one that was the subject of a court ruling last week.

There was nothing creepy about Justice Edward H. Lehner’s decision in State Supreme Court in Manhattan. He found that a would-be buyer, Jeffrey M. Stambovsky, could not back out of a $650,000 contract on the three-story clapboard house without losing his $32,500 down payment on it.

Mr. Stambovsky, who acknowledges that the contract expired after he skipped a scheduled closing last fall, had argued that no one warned him about any preternatural residents who, presumably, would not comply with ordinary eviction orders.

As for whether he will see the ghosts in Nyack – in 22 years, the owner, Helen V. Ackley, has seen only one.

”He was sitting in midair, watching me paint the ceiling in the living room, rocking and back forth,” she said. ”I was on an 8-foot stepladder. I asked if he approved of what we were doing to the house, if the colors were to his liking. He smiled and he nodded his head.”

Mrs. Ackley said one of the other ghosts would waltz into her daughter’s bedroom. ”We don’t know whether or not she was the one who woke the children up by shaking the bed,” she said.

Ghost No. 3 was a Navy lieutenant during the American Revolution. ”My son saw him eyeball to eyeball outside the basement door,” Mrs. Ackley said.

Atlas Obscura writes:

During the 1960s, the 7,000 residents of the tiny village knew that the 5,000 square foot house was haunted, but nobody bothered to tell the Ackley couple before they decided to move in.

Helen and George Ackley, who lived in the home for more than 20 years, reported that they had seen a ghost in the house on at least one occasion and that they would be awoken every morning by a shaking bed, but otherwise lived in peace with whatever spirits resided in their home. When they decided to move and sold the house in 1990, they didn’t bother to tell the new buyers about the ghost problem.

With $32,500 in escrow, Jeffrey and Patrice Stambovsky backed out of the contract when they learned that the house was haunted. When the Ackleys refused to refund the deposit, the Stambovskys sued, leading to what would come to be known as the “Ghostbusters” ruling. The New York Appellate court ruled that, because a routine home inspection would never uncover it, sellers must disclose that a house is haunted to potential buyers.

Here is a Google Map of the haunted house:


View Larger Map

H/T PropertyProf Blog