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Does a Random Massacre Impact Area Homes Values?

Written by Posted On Monday, 14 October 2013 15:24

The incomprehensible rampage in Newtown, CT shattered the idyllic community and inflicted unimaginable damage to not only the families but to the residents of the community and surrounding areas. Just as Columbine is forever tied to a school shooting, so will be Newtown. Violent crime committed in a home can impact value and marketability, is it the same for an area? Based on the data, no. Based on research, there are far too many variables when considering value trends in an area. Newtown is an extremely well regarded area; economically stable, high locational desirability and by all accounts, an exceptionally desirable area in which to live. This random act of violence could occur anywhere; unfortunately this isn’t unique to Newtown. While forever linked to this despicable massacre, it’s unlikely that home values in Newtown as a whole will be adversely impacted. What about individual homes where high profile murders occur? Nicole Brown Simpson’s condo saw about a 27% drop after almost two years on the market, selling for $590,000. Michael Jackson’s estate has moved from $40M to $30M without sale. The “Heaven’s Gate” mass suicide home was valued at $1.6M and ultimately sold for $668,000 and then demolished. Then there are the ones that find buyers that don’t seem to care. Jeffrey Dahmer killed his first victim with a barbell, dismembered his body and buried it in the woods surrounding his home. A potential buyer didn’t mind; "My first reaction, of course, was 'eww,'" Paul Butler told AOL Real Estate. "But then I went and really thought about it, and it was actually kind of creepy-cool. Besides, the house was perfect. So I went ahead and bought it." He paid $245,000 off a list of $269,000 and now seven years later he’s selling it for $329,000.

Andrea Yates drowned five kids in her bathroom, that wasn’t an issue for Peter Muller who bought the Houston home in 2004 for $87,000. He was drawn to it by a “great floor plan” and wealth of desirable qualities, including its proximity to Houston's city center and a number of schools and hospitals. Market value is estimated between $110K-$120K but Muller has no intentions of selling and is happy living there; “It has everything I need." Obviously there are many more high profile cases of homes selling and failing to sell, along with thousands of violent crime homes that remain local stories. Buyers should be aware that in many states, disclosures concerning events like these may not be required unless agents and sellers are directly asked. The impact of violent crime on an area and individual home can vary; one thing that seems consistent is that everything has a price. Despite the circumstances or back story, a buyer will eventually step forward. As the owner of the Dahmer home said, "It may have a terrible history," he added. "But the house didn't kill anybody."
We've appraised many homes where violent crimes have occurred, including at least two with multiple murders. It seems that time heals all wounds; both homes sold not long after the incidents (within 18 months) close to where the market dictated. Both buyers had little concern about the random violence. As far as drive by shootings or home invasions....not all that uncommon in some Atlanta areas and seemingly accepted by the folks that want to live in certain communities.
Hank Miller, SRA
Associate Broker & Certified Appraiser
Atlanta Communities
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Hank Miller, SRA

Hank Miller is an Associate Broker & Certified Appraiser in the north metro Atlanta area. Since 1989, real estate has been his full time profession. Hank´s clients benefit from his appraisal and sales experience; they act upon data, not baseless opinions. He is an outspoken critic of the lax standards in the agent community.

Hank remains an active certified appraiser and completes specialty work for FNMA, lenders and attorneys. He is a well-known blogger and continues to guest write for multiple industry publications as well as national outlets like the WSJ, NYT, RE Magazine, USA Today and others. He is a regular on public Q&A sites on Zillow, Trulia and many others.

Hank consistently ranks in the top 1% of all agents in the metro Atlanta area. He runs the Hank Miller Team and is known as much for his ability as he is for his opinions. He is especially outspoken about the lack of professional standards and expectations in the real estate industry.


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