Guest Post by Mark Weisleder (excerpted from the original)
This topic discusses what Sellers and salespeople need to disclose when selling properties. Here are 3 key lessons to remember:
- Patent or visible defects do not need to be disclosed
If you can see a defect during a typical home inspection, it does not need to be disclosed by a Seller. This can include a crack in a window, mirror or kitchen counter, a stain under the bed or damage to a wall behind a picture. The lesson is to be more diligent when inspecting a property before signing any agreement in the first place. Do not be shy about lifting small appliances from the kitchen counter or area rugs and try to make sure all windows actually open properly.
- Latent or hidden defects need to be disclosed by the Seller
Latent defects are defects that a home inspector could not see during a typical home inspection. If a Seller knows about a material latent defect and does not disclose it, a Buyer can sue the Seller even after closing. Examples include water damages that have not been properly repaired, whether from the roof or basement, smoke damages from a fire, mold behind the walls, underground fuel tanks or foundation problems. If a Buyer can demonstrate after closing that the Seller must have known about the issue, they can be successful in taking legal action after closing. Buyers are advised to conduct an insurance search against any property to see if a prior insurance claim was made by a previous owner.
- Psychological stigmas do not have to be disclosed
Although the law is evolving, Sellers do not have to disclose whether there has been a murder or suicide on the property or adjoining property or whether a pedophile lives on the same street. As this will likely matter to most Buyers, Google the property address to see if anything comes up, visit websites such as housecreep.com to see if there were any stigmas reported on the property and consider putting a clause right in the offer whereby the Seller represents and warrants that to the best of their knowledge, there has been no murder or suicide on the property. Sellers must respond truthfully to this statement.
Mark Weisleder is a Partner, author and speaker at the law firm Real Estate Lawyers.ca LLP.
Marg Scheben-Edey is a Broker with RE/MAX four seasons realty limited, Brokerage in beautiful Collingwood, ON. With three decades of experience, Marg is a leader in the local real estate marketplace and is ready to help guide both Buyers and Sellers in achieving their real estate goals. Email Marg