Murder, drugs and buried pets: These are the most disturbing things vendors should disclose about a home before sale

Would you be comfortable buying a house knowing it had been the scene of a heinous crime like a murder, or that it had once been a drug dealer’s haunt?

For some buyers, either of these circumstances might cause them to think twice before making a commitment to buy.

But what if the agent hadn’t disclosed either of these things to you and you unknowingly bought the house? Who’s at fault and what could you do about it?

One thing you can do before you purchase is to check to see if the agent has disclosed all relevant information about the property.

All agents in Australia must abide by their state’s Real Estate Code of Conduct and the applicable elements of the Competition and Consumer Act.

Failing to disclose relevant information, promises, opinions and predictions can also be misleading or deceptive.

While some of the most controversial problems with properties are rare, important issues such as zoning are more common and should be investigated.

Murder at the property

A few years ago I sold a property where the killer was convicted but the body was never found – a situation that deterred many buyers. The new owners didn’t see this as an issue and got the house blessed and renovated. To them the location was perfect and they felt they had a good investment.

Although the incident of having a murder in the house is extremely rare, the stigma attached to the house stays in the real-estate world the longest.

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Drug sales and usage

A home associated with drug sales usually causes a problem for the next owner.

On many occasions the neighbours will inform the new owners about the previous occupants and are happy that they purchased the property.

In circumstances where the owners have been involved with alleged illicit drugs, agents are in a very tricky situation as it is an alleged situation, not necessarily proven, but the neighbours are always on hand to inform. The odour around the house is the main tell-tale and is difficult to mask.

If the home was tenanted, generally the owners pay the expense of evicting the tenants and renovating the home, which can take weeks – just enough time for clients to realise that their suppliers have moved.

One of my buyers took to advertising in the local paper stating that the property has sold and the previous owners have moved.

Generally, the stigma fades with time as new owners change the whole feel and purpose of the property.

Animal buried in the back yard

A family pet buried in the back yard will not be a problem to many buyers, but we live in a culturally diverse country and superstitions are very real to some people. Many will purchase the property but would like to know first, as they then can take actions to cleanse the home.

This is a difficult disclosure to monitor, as in many backyards a pet has been buried. The current owner may not even know of this. This would be considered as a courtesy disclosure if information was present, unless specifically asked by a buyer.

Other important disclosures

The rule of disclosure is not simple. Many buyers and sellers do not look at the property titles properly and are unaware of the conditions on some of the more complicated ones, such as the proper zoning of the area and any encumbrances.

If a structure such as a shed or patio has been on the property for a long period of time, don’t just assume it has council approval, it still needs checking. Retrospective approval can often be obtained.

How vendors can avoid misleading buyers

The High Court has found that conduct is not limited to a positive action or representation, and silence can be considered misleading or deceptive in some circumstances.

Sales representatives and licensed agents are deemed to have power over consumers because of their greater expertise in property.

For the court to identify unconscionable conduct, there are some factors set out. It is important to establish if the parties acted in good faith, and whether all parties involved were able to understand all the relevant documentation.

Many agents provide a disclosure form to their clients to fill in at the time of listing and this has assisted with the reduction in complaints about sales representatives as the owners have completed the forms.

Usually any disclosure problems are resolved prior to settlement but some do end up in court.

Cheryl Oprandi is a property consultant and auctioneer at Sell Lease Property