Is it unethical NOT to tell about new development next door?

jb_njJuly 21, 2010

We are considering selling our home. We have an empty lot next to us that a neigbor mentioned he heard is being sold and that a house will be built.

Because this lot is on a hill next to us it would remove any privacy we have in our backyard (the new house would look down on us). This would be a negative to whoever buys our home.

Is it unethical for us NOT mention to any potential buyers about the possibilty of a new house being built next to us?

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Yes it is.

    Bookmark   July 22, 2010 at 6:08AM
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Not so fast...

We went through something very similar a few years ago when we tried to sell our home. The large, single lot next door was in negotiations to become a 12-lot subdiv. I asked my realtor if we should disclose, and he said, "what if they didn't build it?" Lots of things happen in business and deals remain unconsummated.

Four years later, that lot still sits, unsold and undeveloped. The original deal fell through, the recession kicked in, the owner had a heart attack (really) and there doesn't look to be any chance of development there any time soon. If we had rushed to "disclose" what wasn't there, we might have lost a sale.

    Bookmark   July 22, 2010 at 7:41AM
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There is always the potential that a house can be built on a residential lot that is available. You could point out that there is a residential lot adjacent to yours and leave it at that.

This is a bit different than say, you found out the lot next to yours was rezoned commercial and a gas station could go in next door.

    Bookmark   July 22, 2010 at 8:19AM
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Every state has disclosure laws that need to be followed. I am unaware of any state that forces disclosure of rumors and speculation though.

You are under no obligation to tell a potential buyer about what might happen to surrounding properties at some future date. You are only responsible for disclosing facts about your property. If the buyers want more information about the neighborhood or neighbors etc, then they, or their agent, are free to research that on their own.

    Bookmark   July 22, 2010 at 8:24AM
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Word of mouth is not legal notice.

    Bookmark   July 22, 2010 at 8:44AM
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In the 80's we were selling a home and our neighbors told us they were seeking a variance so that they could build a garage less then 5 feet from the property line. We said we wouldn't oppose the variance. We asked our realtor if this is something prospective buyers should be aware of and she said, unless they had already acquired the variance it wouldn't be an issue. She said seeking a variance wasn't the same thing as actually having one. We didn't disclose. Years later we passed by the home and the neighbor's garage had never been built.

You never really know what the plans are for that property until permits etc. are drawn. I wouldn't disclose a rumor and right now that's all you have.

    Bookmark   July 22, 2010 at 9:58AM
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At this point it's hearsay and that's all. Even if it weren't, consider that in residential sections, an unusual expanse of ground with no building on it is a potential home site. That thought should occur to any buyer as a part of the buying process as it's the normal course of events. Assuming a home does go there, that doesn't automatically make it some sort of irreparable fault, even if you'd prefer not to have somebody living near-by. If it were some sort of prospective zone change, or code variance it might be a different situation.

Everybody has their own zone of comfort when it comes to privacy. It's a pretty common situation in new developments to have none, zero and zilch. I don't expect if you were buying into a new housing site the builder would feel obliged to state the obvious, that you might be able to lean out your bedroom window and spit into the folk's next door's. ;-)

Caveat.........not a legal opinion by any stretch. But, I've looked at a lot of homes in my life, and I have always, always ? who owns an adjacent empty lot and if it wasn't the selling party then understood the obvious and not having that possibility handed to me on a silver platter.

Anyway..........if a prospective buyer would ask a selling agent about it, the selling agent would probably be truthful to the extent of their awareness. That's part of what they're being paid for, to handle a situation properly a seller might find awkward. No?

    Bookmark   July 22, 2010 at 10:36AM
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If the buyers are curious, they can check on it themselves. I wouldn't mention a word about it.


    Bookmark   July 22, 2010 at 11:59PM
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It's sort of like knowing all of the ins and outs of HUD and Section 8 Housing, and Government funded deals, of course I know. Now, go do your own research.

I have a house near a sleepy little Air force base that will soon become Boston Logan II, a fact which I won't add to my listing.

    Bookmark   August 4, 2010 at 12:46PM
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Formerly known as Otis?

    Bookmark   August 4, 2010 at 1:08PM
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How about this scenario? The prospective buyers ASK if they think anyone will develop that lot?

    Bookmark   August 22, 2010 at 4:08PM
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You reply "It's hard to say" and leave it at that. If they persist, say "I don't know". If they ask again, repeat "I don't know".

    Bookmark   August 22, 2010 at 6:49PM
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No ethical duty, a buyer should assume that an empty residential lot will be built on, and assuming that they can probably see that it will have an impact on their yard. If it were a done deal and you had seen the plans, I would let them know about it, but again that is just me, not a legal duty, but perhaps an ethical one.

    Bookmark   August 22, 2010 at 7:59PM
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