“Buyer Beware” is a phrase we often hear and worry about when we are buying various items; however, the stakes vary based on what is being purchased. For most, buying a new home will be among the largest purchases a person will make during their lifetime.
Fortunately for new home buyers, there are certain processes in place (i.e. inspections) that help identify potential issues within the home prior to closing on the purchase. What if the problem is not about a foundation or faulty electrical work? What if your major concern is about who lives next door? Legally, sellers must disclose physical problems with the home, but they are not required to tell you about bad neighbors, even if that neighbor is a convicted felon.
No one wants to harm the sale of their home and that is a fair concern. Yet when someone is investing in a property, the buyers will want to know about anything that could affect their quality of life or the resale value of the home. Things like unsavory former tenants, ghosts and a nearby mental health facility could bring down the cost of a home. This common sentiment among realtors is that by disclosing this information, you are creating unnecessary angst or feeding into superstitious beliefs, information that may or may not be true. This is why realtors tend not to talk about these points.
Due to legalities, realtors are not allowed to divulge the ethnic makeup of a neighborhood because it violates the fair housing laws. As for the local convict, this is a grey area – someone who served time is no longer seen as a risk to the community (hence why they are now free). It is up to the local law enforcement to keep the neighborhood safe.
To sum up: Buyers have a right to know and understand what their realtors are and are not required to disclose. Some advice for new buyers- be sure to ask questions and understand the responsibilities of your realtor so you can do your own due diligence on the new home and neighborhood as needed. You deserve to be confident and comfortable with the home you decide to purchase.