Buying a murder house could save you a lot of money – if you can handle the terror

While some people wouldn't dare set foot on a property where a murder has taken place, others would happily call it their home forever – and would even pay a premium for it.

For proof, one only has to look at Santa Clara, California, where a house recently went up for sale just months after news broke that a Google engineer had killed his wife in it. Despite that house's grim history, it ended up selling for well over its asking price of $2.1 million.

Apparently, some buyers find the bad luck less terrible than another bidding war in the area's highly competitive real estate market.

However, most murder houses remain on the market and are sold at a significant discount.

For example, Nicole Brown Simpson bought her condo in Brentwood in January 1994 for $625,000. After the murders of Brown Simpson and Ron Goldman The LA home was offered for sale in 1995 for $795,000.

It was for sale until 1996, when it was sold for $520,000. In 2006, after a renovation and a clever change of address, the house changed hands again for $1.72 million.

With the right changes, a home can be given new life, so to speak.

In 1989 Erik and Lyle Menendez murdered her parents, Jose and Mary “Kitty” Menendezin their home in Beverly Hills, California. The Menendez family had bought the mansion the year before for $4 million. Since the murders, it has been sold twice, including this March for $17 million.

This high price certainly sounds like a success story, but the forensic expert Orell Andersonthe president of Strategic Property Analytics, estimates it was about 25% below market value.

Why most murder houses are sold at a discount

According to the National Association of Realtors®, murder houses fall into the infamous category of “stigmatized properties” that are difficult to sell. (This includes homes where suicide or violent crimes have been committed, or that are located near a cemetery or neighboring murder house.)

This stigma can so severely affect a property's value that home sellers in many states are required by law to disclose whether a murder has occurred in their home – similar to how they must disclose previous floods or termite infestations.

However, in other states, such as Connecticut, sellers are only required to disclose that a murder occurred in the home if the buyer asks, while in other states there is no requirement to disclose such a thing.

“I was probably involved in more murder house deals than I realized,” says a Connecticut real estate agent Kate JoyntOwner of Atmosphere Real Estate Services. “Some states require this information, others don't. If you go to closing and don't know anything, you're pretty much lost. Everyone is put off when something grotesque happens on a property.”

According to Joynt, how long a house can stay on the market is “directly related to the seller's willingness to lower the price in order to sell it. This shrinks the pool of buyers and you have to lower the price. You have to get exactly the right price.”

But a price reduction may not be the only downside to a murder house. For example, if a house is known for a tragic event that occurred on the property, onlookers and crime buffs may tour the property and take photos.

But in Joynt's experience, most home buyers have a price in mind that will turn a “murder house” into a livable property.

“I also think that there is a part of the population that just doesn't care,” says Joynt. “Some people live practically and are less sensitive – for the right price.”