I had something very similar happen to me. My next-door neighbor was convicted and put on the sex-offender list. For nearly two years as I tried to sell my home it steadily decreased in value.
It wasn’t until he lost his home due to foreclosure and moved far away that I was able to get a buyer and at that it was as a short-sale. I figure I and the bank lost about $150K in value because of all of the buyers that were scared off in that time period.
And before someone asks, under state law it was something that has to be declared to a prospective buyer.
Why’d you sell after he was gone?