Stigmatized Property Appraisal

[keysersosa1]

I have an order to do an appraisal on a property where 2 people were recently murdered in the house. Does anyone know where I can find information on adjustments made for stigmatized properties ?

 

[Terrel L. Shields]

Prolly zero...and it deflates with time even so.

I appraised a place a few years ago. They didn't believe me and set a much higher price. It did not sell for almost 2 years. Finally sold for almost exactly what I had appraised it for. Two months after the sale no changes in the property, the wife caught hubby in an affair. She shot him in bed. Arrested and the husband's father administered the estate, the woman QC'd the property, and he told the bank to REPO it. The bank about six months after the murder sold it for 10% more than it sold previously.

The only other one was years ago, the daughter of my appraisal partner rented a small house after she married. It paid the mortgage. The renter committed suicide with a shotgun (don't do that) blew blood and guts all over the walls, then he rolled off the couch and soaked the carpet and into the old wood flooring. She cleaned it up, ripped out the nearly new carpeting and scoured the wood floors, but no one wanted to rent it. She took about 20% haircut on what she paid for it, basically just a short sale with bank approval for the note balance.

 

[Vermonter]

Any impact on value will be market specific.

I know properties in a rural town that have been stigmatized for decades and others in more populated cities that sold at market 6 months after a murder

 

[residentialguy]

Realtor disclosure: This house is to die for.

 

[keysersosa1]

Any impact on value will be market specific.

I know properties in a rural town that have been stigmatized for decades and others in more populated cities that sold at market 6 months after a murder

those that sold 6 months after -did they sell for much less?

 

[shrubberyvaluation]

I have an order to do an appraisal on a property where 2 people were recently murdered in the house. Does anyone know where I can find information on adjustments made for stigmatized properties ?

Probably hard to quantify. Depends how well known the murder is to a typical buyer. I personally wouldn't care as long as there were nothing left of it such as blood stains. I wouldn't be surprised if very high profile ones, like Amityville horror, become more valuable over time, but I can't say I have any experience in the matter. This is all conjecture.

 

[uncle sam]

I have an order to do an appraisal on a property where 2 people were recently murdered in the house. Does anyone know where I can find information on adjustments made for stigmatized properties ?

Stigmatized Property: The subject is a stigmatized dwelling where a triple homicide was committed by a family member. A stigmatized house may be one such as this where a murder was committed, a home which is thought to be haunted, where a notorious criminal lived, drug lab, or "crack house", etc., where the price would be affected in usually a negative manor. Although some of these dwellings are removed and new dwellings constructed, the leading appraisal expert in stigmatized housing says the stigma also appears to attach itself to the land. Randall Bell has been appraising stigmatized housing for the past twenty years and is considered the foremost expert in the field. Although no mathematical formula can be applied Mr Bell feels that the actual sale price of a stigmatized property is generally between 5-20% depending on the reason for the stigmatization and the value of the home. Also, a factor for these homes is that in a study done by Wright State University it was found that these stigmatized properties were generally on the market for 45% longer than a normal property. As Harrison is a town of approximately 13,000+ residents where families generally stay for generations and children when joining the workforce tend to purchase near the family home. Due to this factor, and that the area is a primarily "blue-collar" town the appraiser feels that almost all of potential buyers would be hesitant to purchase. However, once again appraiser Bell states that if the price is well below market value many investors will purchase. For the purposes of this appraisal the appraiser has decided on an adjustment for stigmatization mid-way between the experts range, at 12.5%.

 

[glenn walker]

We haev purchased at least 4 properties in last 30 years were murders had occurred. This is what I learned first its a lot about Social economics meaning in undeserved or poor communities or high crime neighborhood s its not an uncommen event and often has only a 5% to 10% effect on a resale value . I purchased one in Felony Flats where a women had been beat with a baseball bat and stabbed over 25 times. Blood was running down walls and on carpet. I purchased it at a 35% discount but almost all of that was because of its overall poor condition and not the murder. We purchased what we called the Dead Hooker Motel on old Route-66 in another high crime area and same thing over 5 murders in that motel over a 6 year period and we sold it at full listing price We had a home in Compton CA the infamous place where crime and murders are monthly events. Again a murder house we cleaned up and refurnished and with buyer disclosures required to be signed and notarized by the buyer and we sold at a 5% discount. NOW THE FLIP SIDE: The test is who was murdered and where did it happen as when done in high end communities like Beverly Hills and the murderer is a famous celebrity the price and value can be considerably effected and lower. O.J. Simpsons home was sold for land value only and buyer knocked it down and built a new mansion even though NOBODY had ever been murdered in O J Simpsons house but what happened is it created a circus even where Hollywood Tour Guides Buses where driving by every 10 minutes. In Summary if murder happens in Felony Flats almost no discount but in general most murder houses take a lot of money to clean up refurbish and get rid of blood and body fluids,. Hope this helps but there is no standard formula for stigmatization as some is very small to none and others are big deals.

 

[Terrel L. Shields]

If a white marker were placed everywhere someone had died since early Indians skewered one of their buddies 14,000 years ago, to grandma dying at home, then the whole country will be impossible to walk with tripping over one. Or like a tour guide explained to a group of visitors to a battleship, "And this plaque is where our gallant Admiral fell." One old lady pipes up, "I can see why. I dam near tripped over it myself."

 

[Vermonter]

those that sold 6 months after -did they sell for much less?

No. Homeless guy murdered a lady that gave him a room to stay in. Her family cleaned it up, painted it and sold it 6 months later. Very inline with non-murder homes but did have about double the DOM. This was in a low inventory hot market tho.

And then in a little town of 800 near a ski mountain I've watched a double homicide house sell at better than a 10% discount 4-5 times in 20 years.