Is it obligatory for the seller of a house to inform the buyer about a bad neighbor, or is that not considered a defect in the dwelling?

The seller must inform the buyer that the neighbor is a bad neighbor, as this is a defect that warrants rescission. Al-Ruhaibani mentioned in "Matalib Uli al-Nuha" that a bad neighbor is a defect; indeed, it is among the most severe defects. It was narrated from Imam Malik that a bad neighbor is a defect that necessitates the option (of rescission). Among what is attributed to Al-Shafi'i regarding neighbors is his saying: "They blame me if I sell my house cheaply But they do not know there is a neighbor there who causes distress. So I told them, 'Stop your blame, for It is by their neighbors that homes become expensive or cheap.'"