Stigmatized properties are those properties that society has branded undesirable because of events that occurred there. Stigma is the continuing negative association with or feeling about the property.
Article 15 of the Real Estate License Act of 2000 states that in dealing with specific situations related to disclosure, “no cause of action shall arise against a licensee for the failure to disclose:
- that an occupant of that property was afflicted with HIV or any other medical condition or
- that the property was the site of an act or occurrence which had no effect on the physical condition of the property or its environment or the structures located thereon.”
- no cause of action shall arise against a licensee for the failure to disclose a fact situation on property that is not the subject of the transaction.”
- no cause of action shall arise against a licensee for the failure to disclose physical conditions, located on property that are not the subject of the transaction, that do not have a substantial adverse effect on the value of the real estate that is the subject of the transaction.”
For any action brought under Article 15, “the court may in its discretion, award only actual damages and court costs or grant injunctive relief, when appropriate.”
Any action brought under Article 15 must commence within two years after the person bringing the action knew or should have known of such act or omission. In no event can the action be brought more than five years after the date on which the act or omission occurred. If the person entitled to bring the action is under the age of 18 or under legal disability, the period of limitation shall not begin to run until the disability is removed.
The buyer’s agent is the one to suggest the highest range of prices the buyer should consider, based on comparable values and current market. The agent’s aim is to help the buyer get the lowest price possible, given all other buyer concerns and needs. The buyer’s agent discloses information about how long a property has been listed or why the owner is selling, if known. Of course, a seller’s agent who discloses such information violates the agent’s fiduciary/statutory duties of loyalty to the seller.
The seller’s disclosure form is a good guide to follow for what must be disclosed to all parties by the listing side of a transaction.
In all other respects, unless it is illegal or a material fact about the property itself, the seller’s agent should follow the seller’s lawful instructions. A buyer’s agent should be on watch and do what research is possible.
Megan’s Law
At the state level, Megan’s Law is a general name for laws requiring law enforcement authorities to make information available to the public regarding registered sex offenders. Individual states decide what information will be made available and how it is to be disseminated. Commonly included information includes the offender’s name, picture, address, incarceration date, and nature of crime. The information is often displayed on public sites but can also be published in newspapers and pamphlets or disseminated through various other means.
At the federal level, Megan’s Law is known as the Sexual Offender Act of 1994 and requires persons convicted of sex crimes against children to notify local law enforcement of any change of address or employment after release from custody (such as prison or a psychiatric facility). The notification requirement may be imposed for a fixed period of time, usually at least ten years, or permanently.
Some states may legislate registration for all sex crimes, even if no minors were involved. It is a felony in most jurisdictions to fail to register or fail to update information.
As noted, Article 15, Section 15-20, of the Act states, “No cause of action shall arise against a licensee for the failure to disclose… fact situations on property that is not the subject of the transaction …”
Listing agents have no legal duty to disclose that a known sex offender resides in a property near a listed home, but skilled buyer’s agents should be watchful for any signals of hard-to-identify issues. Sex offender location lists are public information, and a buyer’s agent should refer a buyer client to such lists if asked.
