Close
Real Estate Investment News & Blog

12 Bizarre but True Real Estate Horror Stories

78

Things have been pretty scary in the real estate market since 2008. On that, most can agree. But no matter how bad they’ve gotten, some of us still consider ourselves very lucky, especially when considering the 12 Bizarre but True Real Estate Horror Stories presented below. Seller, agent, buyer…no one is safe! Read on, if you dare.

1. 3 vs. 1

Dean Foust originally shared his nightmarish experience in a Bloomberg Businessweek column. He and his wife were trying to sell a starter home in Washington D.C., circa late 1990s. They were asking $235,000 for the home. When they received a $226,000 offer with buyer demands that they cover $6,000 in closing costs, their agent prodded them into strongly considering the offer. Ultimately, they sold for $228,000 while honoring the closing cost request at the behest of their agent. Pre-housing crisis, Foust said, homes in this neighborhood were selling for between $650,000 and $700,000. “In hindsight, I felt that I’d been negotiating against three people–the buyer, his agent AND MY OWN AGENT,” Foust wrote.

fighting kids

Source

2. Backstabber

From the Omaha Homes for Sale Blog: real estate agent Troy Trumm was under the assumption that it was his fiduciary duty to get his clients the best deal possible. That’s why he was shocked when another agent called him to let him know there were buyers interested in his listing, and that they would be willing to pay the full asking price in spite of their offer for $6,000 less. “Of course the reason this agent told me this was because he wanted to make sure that the offer got accepted, so that he would get paid. He knew he was backstabbing his clients by putting his own interests above theirs,” Trumm said. As luck would have it, Trumm’s listing received a higher offer before the other could go to closing, so “the Backstabbing Buyer’s Agent had gained nothing from his evil ways,” Trumm added.

knife

Source

3. Dunce

New South China Mall may be one of the worst commercial real estate investing disasters of all time. “Completed in 2005,” writes MSRE/CFE Vernon Martin for Internationalappraiser.com, “it is the world’s largest mall with leasable area of 7.1 million square feet, gross building area of 9.6 million square feet, space for 2350 stores, and a 99.5% vacancy rate.” Martin visited the mall in 2011 and snapped some pictures. What should have been a wonder of modern retail looked more like a set-piece from Dawn of the Dead. Nevertheless, Martin told CRE Online in a recent interview, “the mall manager has announced plans to build 2 million more square feet.”

mall

Source

4. Meth Heads

Dawn Turner purchased a home in rural Tennessee and found out two years later, at the time of sale, that the home had once belonged to a person, who was in jail for producing methamphetamine on-site. The revelation also obligated Turner to take the necessary steps of decontaminating the home and ensuring it was fit for resale, costing him and his family a whopping $16,000 in the process. Turner now runs MethLabHomes.com, and tries to prevent such actions from happening to others.

meth lab

Source

5. Subdivided and Conquered

Attorney Ken Koenen of Pleasanton, Calif., shared one real estate horror story involving some clients, who owned a 10-acre a lot (with home)–total price of $390,000–that they planned to subdivide into two 5-acre lots, selling off the vacant lot and refinancing the house lot. In 2009, when they tried to sell, they discovered that the lender, title company, and/or the escrow company erroneously showed the assessor’s parcel number on the deed of trust, but showed the legal description of the vacant lot. “Now, they could not sell or refinance,” Koenen said. “They attempted to contact the lender and the title company to get them to correct it, but just got the run around.” Since the original discovery, the value of the lot has plummeted, disabling the clients from selling for the amount of the loan. “Nor can they refinance to get today’s interest rates,” Koenen added.

loan application

Source

6. Home Robbery

A 76-year old property owner and a real estate agent in La Jolla, a prominent part of San Diego, Calif., were accosted by an armed man at a showing in August 2012. The man demanded to know “where the jewelry was,” reported U-T San Diego, and made off with jewelry and fur coats, but not before firing into the ground and hitting the property owner with a piece of shrapnel in the process. No serious injuries were reported, and no arrests have been made at this time. Bob Kevane, a former president of the San Diego Association of Realtors, told U-T San Diego the incident was “pretty unique.” Still, it highlights the vulnerabilities that exist in the home sales process.

crime scene

Source

7. American Real Estate Horror Story

The celebrity-entertainment site TMZ reported on Aug. 18, 2012, that 43-year old actor Morris Chestnut (American Horror Story) recently got involved in a little real estate horror story of his own. After purchasing a 5,000+-square foot home in 2007, Chestnut tried to unload the property this year for $3 million, $300,000 less than he paid for it. As if that wasn’t bad enough, the final sale price came nowhere close at $2.3 million-a full $1 million loss on his initial investment, and a strong indicator, at least in the Hidden Hills, Calif., area, that things aren’t getting better any time soon.

morris chestnut

Source

8. Hamptons Wannabes

In the book The Hamptons Real Estate Horror Show by Anonymous Times Two, the authors recall their story of Wesley and Amanda, two small children, accompanying Wesley’s parents on a supposed house shopping trip to the Hamptons in New York. The eager couple insisted on seeing a $6.8 million home, commenting how eager they were to buy the entire time. Then, before leaving, little Amanda complained about the size of the rooms, and with the snap of a finger, the deal fell through. “It happens a lot,” Anonymous No. 1 told the Sag Harbor Express in a recent interview, adding that the story was classic for its demonstration of client egos and for the reality of how a deal can dry up in an instant, and not always for the best of reasons.

hamptons

Source

9. Home Wrecker

VIP Realty representative, Regina Stockwell, in a piece for InvestingAnswers.com recounted one tale of a man who lost his home to foreclosure, and made certain the bank would remember his name. With nothing left to lose, the Texas resident poured concrete down all the drains, yanked the porch from the house with his truck, and left holes in each of the walls–sometimes multiple holes in one wall, as a final farewell. Stockwell said that the former tenant did such a number on the place that the city government had to demolish the entire structure.

vandalism

Source

10. Houses of Horror

It may seem hard to believe, but there is a breed of real estate agent, who specializes in the selling of stigmatized houses, or homes where great tragedies, crimes, or traumas have taken place. Perhaps the most famous currently on the market is that of Jeffrey Dahmer. The notorious cannibal serial killer is credited with more than 17 confirmed murders, and the first one happened at this 2,170-square foot home currently on the market for $329,000 in Akron, Ohio. The seller told The Daily Beast that it was a lovely home once one could “get past the horror factor.” Hmm. Good luck with that, Mr. Seller.

house of horror

Source

11. Moving Day Disaster

In a piece that originally appeared on the Zillow blog for Yahoo! Real Estate, Seattle resident David Tobey was moving to a new residence within the city when his movers turned what should have been a joyous day into an absolute nightmare. Tobey advised movers from Neighbors Moving Company to park in front of the building, but the company reps thought they knew best and, fearing a ticket, decided to park on a steep hill close to the building. Moments later, the new home owner watched helplessly as the truck’s brakes failed, taking about half his stuff with it on a ride that would end in the demolition of two parked cars. Tobey lost a stereo, a bed, some plates and glasses, in the adventure. Plus, his move was delayed four hours. All that, and Tobey got billed by the moving company!

moving van

Source

12. Utility Theft

In a recent piece on MSN Real Estate, one landlord/owner going by the name of “Noroom” shared a real estate investing horror story involving a tenant, who had the utilities cut off and “tapped into my property’s electrical lines with an extension cord and ran four heaters off it for a month, until it burned through on the new hardwood floor.” Additionally, the same tenant “stripped the wallpaper and moldings and sold them to a wood-supply business,” Noroom added. The tenant was caught by another tenant when trying to steal fixtures. At that point, the damage totaled around $3,700, “the cost of his mountain bike, he told me once,” Noroom said. While the landlord was busy paying off the debt left behind, the tenant has since moved out. No reparations have ever been made.

utilities

Source

Whether you are an owner, a seller, an investor, or just an enthusiast, real estate investing can and does lead to some pretty “interesting” stories. Do you have a strange, bizarre, humorous, or just hard-to-believe real estate investment story you’d like to share? Do so in the comments below. We’d love to hear from you!

Sign Up for the CRE Online Newsletter Today ... It's FREE!
Get our best real estate investing information delivered to your inbox.
look!
78
About the Author...

J. P. Vaughan founded Creative Real Estate Online in 1995 and has been the Publisher since then. She is the author of "How to Buy Your Dream House for 1/2 Price" (Quantum Publications 1994, out of print). J.P. is also an attorney who practiced law in Michigan until she started investing in real estate full time in 1988.

J.P. is co-founder of the: Affordable Personal Coaching & Mentoring for Real Estate Investors program.

You can "Like" CRE Online on: Facebook & "Follow" Us on: Twitter

Comments

  1. Casey Markee says:

    Very nice article. I’d read about the New South China Mall in Fortune awhile back. It’s STILL not even close to minimal occupancy. It’s anchored by a big McDonalds and some small shops and that’s it. Terrible planning on their part. You really can’t even see it from the main roads that bring in people. It’s hidden in a big industrial park. Terrible, terrible planning on the developers part.

  2. Kristi Hagen says:

    Great Read! Thanks for the fun distraction.

  3. We had a rental house in Reno, NV that we desperately wanted to sell. We had moved from the area and were not happy with the property managers we had hired, and there was a long list of them.

    The house was vacant for a time and we thought we could try to sell it since there were no tenants. We got a Realtor to list the house. The market had plummeted and was showing a little upswing and we were very hopeful. We were getting showings but no action and we kept asking the realtor if we needed to fly down and paint or do any work. She kept saying she did not think so. Well after 4 months, we could not carry it any more so I flew down to see what needed to be done and to my amazement found a huge devil painted on the wall, ceiling to floor covering about a 12 foot wide wall. WHAT THE HELL! Could the realtor not see that would be a deterrent to any potential buyer. I wanted to run screaming out of the house when I saw it, I can only imagine the view point of a potential buyer.

    Then the market plummeted again and we got tenants but by then the rental market has plummeted and the rent barely covered half the mortgage. We ended up losing the house to foreclosure and can’t help but wonder if the realtor had told us about the devil before listing it, we could have fixed it and probably sold the house. What was she thinking???????

    • Jeanne Ekhaml says:

      That’s horrible, Jaime. Almost unbelievable that the Realtor didn’t mention it to you.

    • J.P. Vaughan says:

      For 100 bucks or less, the moron agent could have had that wall painted, earned a commission, and saved your house. That’s a horror story!

      JP

  4. Very well done article. Here’s a horror story that prior to the housing crisis of 2008 happened to a friend with me helping him out in the process. In 2006 my friend decided he wanted to relocate to either Plumas or Doyle, CA. In the process of much phoning and emailing between two seperate operators and two separate long drives from the San Francisco Bay Area he decided to check out some properties that were available for between $65K and $80K with the end result being ‘no dice’ in each case.

    The first trip to Doyle, CA involved a stay at the Peppermill Hotel and Casino in Reno, NV. All we knew of the agent we were to meet was from photos of her on her site and when the time came to make the drive to Doyle the next morning where the scenery and the real estate consists of one of the most barren towns I’d ever laid eyes on complete with at least 4 old fashioned one room school house style churches, one fire house, one Dr’s office and one grocery store if I recall right. I swear, upon waiting for the agent in the designated area and meeting her for the first time we could not recognize her because she was clearly 30 years older than the pictures!

    It gets even better! When we went to tour the properties she had which were described as ‘fixer uppers’ turned out to be real ‘tear downers!’ The first property located on some acreage was clearly ripe for a bulldozer-windows had been shot at and were shattered to smithereens, the foundation was visibly sagging and, since we were brave enough to make entry, every wall including one partition between the hall and what remained of bedrooms in this 80+ year old marvel of dilapidation was collapsing due to water damage and mold from base to ceiling! The other wonder that in photos appeared to be a lovely clean yellow painted habitable home surrounded by green grass, trees and wild flowers turned out to be rather close to homes in poor condition. Once we drove up to the property we could see that the paint was weather worn, chipping and had to be over 40 years old and inside, clearly due to the age of the property (over 60) things were sagging inside as well. We were right concerning the paint, the agent disclosed that lead paint was inside and out along with the presence of asbestos. Outside, the grass on one side of the home appeared to be collapsing and my friend observed this and a collapsing septic tank was confirmed. On the other side of the home was a natural gas tank that was hissing: we couldn’t wait to get out of there knowing danger was imminent!

    The other nightmare in Plumas, CA was the result of similar emailing and phone calls between us and a broker investor who made a tidy living for himself as the area financial expert. A property described as 3 bedrooms, 1.5 bath for $75K that was in an area of homes where property values were originally as high as $200K came on the market. Arrangements were made and off we went on the long 4 hour drive to Plumas. Upon arrival after bearing the beautiful and tiring drive complete with road construction crews slowing the process we were told ‘there is a backup offer on the property’ and my friend was asked ‘Would you consider it for $85K?’ This after touring the 80+ year old property complete with self inspection discerning that there were several problems: Firstly with the plumbing: water flow was very weak and toilets flushed poorly (there was a leak under the house), rolling a marble across the kitchen floor revealed sagging floors that to our eyes did appear to slope slightly and oh, the roof was clearly in disrepair needing replacement along with a number of other things. To top it off, this home was behind a bar, things not apparent in photos that showed a home with a view of lush native pine trees. When my friend refused the deal the operator then showed us two other more dilapidated properties and between us, I told him that the reason this guy is offering them as seller carry with a balloon payment to boot is because no lender will finance them and when the balloon is due on any of them, the buyer, unless he has the balloon payment in reserve would be out on the streets.

    We left that place and my friend has chosen to continue renting within his means as a retiree. The scary part about the whole thing is that at that time I was a loan officer and had access to title records. I did a search on the operator and uncovered that over the span of at least 20 years he made quite a living offering properties with seller financing to folks of meager means who, when the balloon payments on most of the properties came due either lost their jobs/income source through business loss prior to it becoming due or ended up foreclosing with the guy taking the property back into his inventory just like the big banks do even now.

    • J.P. Vaughan says:

      Glad you enjoyed the article. Your horror stories should remind everyone how important it is to do proper DUE DILIGENCE. Thanks for sharing…

      JP

  5. Geoff says:

    We moved to Malaysia for an expatriate posting some years ago and agreed to rent a property that was being renovated. A few days after moving in, I walked downstairs and heard running water and then saw that water was pouring out of the downstairs bathroom, down the steps, the driveway and into the street. Luckily the floor was marble. We had been using 2 showers upstairs at the time. Turns out the builders that had renovated the house had poured concrete waste into the shower recess downstairs and it had set somewhere downline. Water had just built up in the early days of our occupation and then had nowhere else to go!

    They had also “painted” a short but steep driveway and when it rained (which was most days), we couldn’t get the car up the drive – tyres just slipped.

    Eventually everything got fixed, but a nightmare for us moving to a new country, let alone the problems the owner of the property had to deal with!

  6. Javier Pérez Cervera says:

    It’s amazing how everything turn around the money and the unscrupulous people that make these actions to get more and more.
    The article is really good, I had a great time reading it, and I’ve shared it with my friends!

  7. Trevis says:

    Great article and useful content. I enjoyed reading and it enhanced my knowledge on real estate horror stories!

    Keep these articles coming!

  8. Our recent homebuying experience north of Denver educated us that it’s one thing for stylists to prop a home for online pix, but a huge shock when you go to view it and find that cabinets, appliances, doorknobs, switchplates, plumbing etc, is taken out, and it smells horrifically of urine and smoke. After 5 months of looking at properties with multiple problems, we got a house that had the least to fix, but still $15K for misc repairs and renovations.

    Realtors should conduct day-seminars for anyone considering buying a home. As to not only the financial application process, but remembering to factor in the long-term costs such as insurance, commute costs and the desire to DIY maintenance.

    • J.P. Vaughan says:

      You’ll learn way more about real estate investing here than you will ever learn from a real estate agent.

      My good friend, William Bronchick founded and runs the Denver Real Estate Club. Check it out:

      Colorado Association of Real Estate Investors – Denver
      http://www.carei.com

  9. TONEY says:

    I THINK YOU ARTICLE WAS GREAT A LOT OF GOOD INFORMATION, BEING A BEGINNER IN REAL ESTATE INVESTING MYSELF, THE PROBLEM THAT I AM HAVING IN FINDING SOMEONE WHO IS NOT A CROOK, IT APPEARS NO ONE WANTS TO DO THING LEGALLY EVERYBODY WANT TO NOT BEND BUT BREAK THE RULE. SO I AM HAVING TROUBLE FINDING A GOOD MENTOR TO SHOW ME THE ROPES THE RIGHT WAY. ANY SUGGESTION

    • J.P. Vaughan says:

      Hi Toney,

      I always advise beginers to join their local real estate club. You can meet and network with other investors and learn the ropes for a small cost.

      Good luck!

      JP

  10. Chelsea Andrew says:

    Ran across this article at Google. Some GREAT examples here. I’m a newly minted real estate agent myself and I certainly hope I NEVER have to experience any of these situations myself. Love your site. I’ll be back.

What do you think? We would love to hear your opinion.

*

Hide me
Let Us Help You Achieve Better Results. (IT's FREE!)
Name Email
Show me