My dad was 96 years old when he died at home — do I need to tell the buyers if I sell the house? Here's what you need to know before listing a 'stigmatized property' in the US

If there are whispers between neighbors of a home for sale that’s host to the paranormal, or even if the owner died recently, it can place sellers in the tricky situation of whether or not they’re required to disclose such details to prospective buyers. That’s not always the case — we’ll explain below — but word of mouth might be enough to affect sales prospects.

Here’s how to handle a stigmatized property sale if you land in a similar situation.

What sellers need to know

It’s hard to imagine how a haunting can be confirmed, but according to an analysis by Zillow, four U.S. states have real estate disclosure laws that mention paranormal activity.

New York courts can rescind a home sale if the owner previously established a reputation that the house was haunted and then sold it to an unwitting buyer. Similarly, in New Jersey, a seller must disclose “a property purportedly being haunted” if asked by the buyer. Massachusetts and Minnesota, on the other hand, simply mention paranormal or supernatural activity as a “psychologically affected” attribute that doesn’t require disclosure.

The disturbing news of a death in a home can give some potential buyers the jitters, and nine states have laws that may compel sellers to disclose a death on the property, per the analysis.

Californian sellers must disclose a death on the property, natural or otherwise, within three years. In Alaska, a murder or suicide within one year must be disclosed. In South Dakota, a seller must disclose if a homicide or suicide occurred on the property. In New Hampshire, a homicide or suicide on the property must be disclosed if asked. Georgia and New Jersey sellers must disclose any deaths if asked.

Delaware, Kentucky and South Carolina sellers must disclose stigmatizing factors, which can include a death on the property, if asked.

To buy or fly away?

Significant stigmas seemingly disturb a portion of house hunters, but not all of them. A Zillow survey found that nearly 70% of prospective buyers would buy a haunted house if it checked all their boxes. In fact, nearly 30% of prospective buyers say they would be more likely to purchase a home if it were haunted.