Occasionally, you’ll run across a homebuyer concerned about whether a death has occurred on the property. To these homebuyers, a death on the property is a material defect in the suitability of the property, regardless of when it occurred.

The manner of death makes a difference to the property’s market value for some homebuyers. Some types of death, such as a murder or suicide, carry heavier stigmas than, say, an elderly occupant who died of natural causes.

A death occurring on a property, and the manner of the death, are always material facts to be disclosed to potential homebuyers if:

  • the death occurred within three years prior to the date of the homebuyer’s offer to purchase; and
  • the death affects the property’s value or desirability to the homebuyer. [Calif. Civil Code §1710.2]

However, neither the seller nor the agents is required to disclose that an occupant of the property was afflicted with or died from AIDS, regardless of when the death occurred. [CC §1710.2(a)]

Thus, for a death occurring on the property more than three years before the date of the homebuyer’s offer to purchase, neither agent owes an affirmative duty to voluntarily disclose information regarding a prior occupant whose death, from any cause, occurred on the property.

Disclosure on inquiry

On direct inquiry from a homebuyer or a buyer’s agent, the seller’s agent is to disclose their knowledge about deaths occurring on the property, no matter when they took place. [CC §1710.2(d)]

An agent’s false statements, deception or concealment of a fact in response to a homebuyer’s direct inquiry is:

  • for a seller’s agent representing the seller exclusively, a breach of their general duty owed to all prospective homebuyers to truthfully respond; or
  • for a buyer’s agent, a breach of their special agency duty owed to the homebuyer as their representative and advisor in the transaction. [CC §1710.2(d)]

Further, an inquiry by the homebuyer into deaths indicates a death on the premises is a fact which might affect the homebuyer’s use and enjoyment of the property. Thus, a death occurring on the property becomes, on inquiry, a material fact.

If your homebuyer asks about deaths on a property, you, as their agent, have an affirmative duty to:

  • investigate the death and advise your homebuyer of your findings and the source of the information;
  • recommend the homebuyer investigate the findings before an offer is made; or
  • make the offer contingent on the homebuyer’s investigation into any deaths on the property.

On inquiry, if you state that you do not know if a death occurred on the property, you need to prepare and hand the homebuyer a memorandum stating:

  • the homebuyer has made an inquiry about deaths on the property;
  • you have disclosed all your knowledge concerning the inquiry; and
  • who, if anyone, will further investigate any deaths on the property.

Deaths affecting market value

Your duty to disclose material facts is not limited to disclosures of the property’s physical condition.

For example, if you know that multiple murders occurred on the property, regardless of how long ago they occurred, the deaths must be disclosed. The notoriety of the murders adversely affects the market value of the property, placing its value below the price the homebuyer may otherwise offer to pay.

If the homebuyer discovers the undisclosed facts of the murders after the purchase, the homebuyer may demand and collect their price-to-value money losses. As the buyer’s agent, you are charged with knowing that the property’s market value, based on the stigma of the deaths, is measurably lower than the purchase price paid.

Every agent has an affirmative duty to voluntarily disclose a prior death on the property when it is known the death might affect the homebuyer’s valuation or desire to own the property. [Reed v. King (1983) 145 CA3d 261]

Disclosure within three years

Although a death occurring within three years of the homebuyer’s offer to purchase only needs to be disclosed by law if it affects the property’s value or desirability to the homebuyer, you need to err on the side of caution. Consider that your homebuyer’s attitude about death may be an idiosyncrasy. Thus, the homebuyer may claim you breached your agency duty by failing to disclose the death since it inflicted an intangible harm on them, preventing them from enjoying the real estate.

As a matter of prudent practice, you need to determine if a death known to you might affect your homebuyer’s decision to purchase the property. The homebuyer’s agent has a greater duty of care to protect the homebuyer than does the seller’s agent (which is limited to disclosing deaths affecting the property’s value). Thus, you need to disclose any death occurring on the property at any time, within three years or otherwise, especially if you sense the death might affect your homebuyer’s decision to purchase the property or the price they are set to offer.

Just as importantly, homebuyers have a duty of care to protect themselves. Homebuyers have an obligation to inquire and discover facts readily available to them or to you, their agent, to protect their own personal interests.