Imagine buying a home only to find out later that a violent crime took place in it, a tornado ripped through it, or there was a drug lab in the basement? As a buyer, you have certain rights as well as responsibilities when it comes to the disclosure on your home’s past, and it’s important to learn before you sign on the dotted line just what you’re getting into. Here are some key considerations when it comes to disclosure, so you can be armed with the right information and ask all the right questions before you put in your offer.
Your real estate agent’s obligations
Realtors in Ontario are governed by the Real Estate Council of Ontario (RECO) and are regulated by the Ontario Real Estate Association (OREA). Participation in these groups means that they must follow strict ethical guidelines, which includes issues around what they can and cannot disclose to prospective buyers. It’s clearly stated that if a real estate agent is knowledgeable about any structural problems with the home or a stigma attached to it (including murder, suicide, drug production and hauntings) that may impact the home’s value, then they are obligated to disclose it before the offer has been made.
The seller’s disclosure obligations
Sellers are required to complete a form called a Seller Property Information Statement (SPIS) when they list their home. Here they must outline any defects, problems and renovations regarding the home, and provide information on everything from the type of wiring, plumbing, flooring, building materials, previous water damage and more. Unfortunately, many sellers may not know the full history of the home, so the SPIS may contain gaps. The bottom, line however, when it comes to disclosure is that the seller and their realtor must answer truthfully to questions about the home and its past. That’s why it’s important for prospective buyers (and their real estate legal team) to ask a lot of questions and uncover as much as they can through their own research.
What about recorded conversation when viewing a property?
Advances in technology have resulted in people having easier access to recording devices that they can install throughout their house, which is exactly what some sellers are doing when they show their homes. As a result, they can hear private conversations about the house, their financing, and what they are willing to pay – to name a few. While this can certainly give the seller an advantage when it’s negotiating time, it’s also illegal. Laws in Canada are very clear that a person cannot intentionally record someone unless they have disclosed that they are doing so. If a seller wants to record people viewing their home, they must put up signs or have their agent tell each person who comes to the home.
To protect yourself as a potential buyer, don’t discuss the home or your opinions about it while you are viewing it, but instead wait until you are away from the property.
When you work with an experience real estate law team, issues such as disclosure and your legal rights are always discussed. Here at Ares Law, it’s our job to find out everything about your new home, cottage or condo, and make sure you and your investment are well-protected. We disclose everything to you and we have your best interests at heart. If you’re buying or selling in the Parry Sound or Muskoka region, be sure to make an appointment and talk to us so we can ensure everything runs as smoothly as possible. Call today at 705-746-6444; we’re here for you.
