Naughty Neighbors can affect your property value


Bad neighbors. Everybody has had one. Whether it’s the perpetual yard sale, passive-aggressive rule enforcers, the urban farmer with a bunch of backyard roosters or the stereo blasters — they can make life awful and affect property values.

“It was a horrible experience,” says Diane Tuman, who works as an editor for Zillow.com. “I never really thought a neighbor could affect your day-to-day happiness, but they can. Every night driving home I’d get a pit in my stomach, not sure what I’d find.”

Tuman and her partner bought a classic Craftsman-style home in a tightly situated section of Queen Anne and watched as the home next door was sold to a woman who liked to smoke and drink wine with loud friends on her porch every night until 1 a.m. The smoke would drift right up to Tuman’s bedroom window. Efforts to get her new neighbor to be more considerate were met with an escalation of the woman’s negative behavior.

The final straw was finding her neighbor on the back deck having loud sex with her boyfriend. Shortly after, Tuman’s partner got a new job that necessitated a move and they both breathed a sigh of relief.

A home in disarray can end up being a city code violation, warns the City of Seattle Office of Department of Planning and Development. Of the 8,299 complaints filed in 2010 with the city, approximately 5,000 concerned problems with neighbors, including noise, vegetation and the ever popular “junk in the yard.”

But some of the most annoying and pervasive problems, like bad smells that waft into a condo unit or the guy next door who paints the outside of his house an eye-searing fluorescent green, cannot be reported anywhere — except to our friends, who tend to get tired of listening after about a year.

“The trouble with a bad neighbor, is that they are unpredictable and it’s difficult to correct that problem. It’s not like a bad floor plan you can fix, or even living next to a busy street where you could get better windows that block the sound,” says Mike Skahen, owner and principal real estate broker for Seattle-based Lake & Co. Real Estate.

Whether they live in the house next door or the condo unit below, no-good neighbors can make the prospect of selling, even at a loss, very attractive. And in this market, that may just happen.

Studies by economists measuring the impact on a home’s value after a registered sex offender moves nearby have shown a decrease in value of around 4 percent, but what about depreciation due to the classic yard full of old washing machines, soiled couches and rusted cars?

Skahen estimates that in the current market there could be up to a 10 percent reduction in the price of a house if you live next to a troublesome property, depending on how bad the problem is and whether it is apparent to a prospective buyer. Right now, he says, buyers expect a perfect house in a perfect neighborhood and if they smell trouble, they move on because they think they can find something else.

“When markets are good, nobody cares; but when they are bad, these problems stick out like a sore thumb,” says Justin Slack, a residential appraiser and board member of the Seattle Chapter of the Appraisal Institute.

Slack argues that it’s difficult to quantify the decreased value of a property due to difficulties with a neighbor because everyone has different tolerances. One man’s modern steel art sculpture in the middle of his front yard is another’s unfinished trip to the city dump.

“It’s also hard to figure out who you won’t get along with and real-estate agents don’t have to disclose a sucky neighbor,” says Slack. But he has some ideas. Slack recommends asking questions. Especially if it appears that one house in a neighborhood sold for a lot less than others.

After it closes, he recommends asking the real-estate agent why that happened. They’ll usually talk to you, says Slack.

“Living in a city, all jammed in together, is not for everyone,” says Tuman. “There is an unwritten code that we all have to live by. Make sure you take care of your property, keep your music down, don’t let the dog bark, that sort of thing.”

By Diana Wurn
Special to The Seattle Times

bad neighbors

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