Whether you are buying or selling a home, you could be dealing with many emotions: stress about such a significant transaction, excitement about moving to a new place and maybe a little sadness over leaving your current home.
In the swirl of these emotions, you might overlook critical details about the buying and selling process. One such detail is the responsibility to disclose certain aspects of a home.
Property condition disclosures
Disclosure statements can be an essential form in a real estate transaction. Sellers complete this document to give potential buyers crucial information about a home so that buyers can make informed decisions.
Sellers must disclose known latent defects, which are significant problems with the home that people cannot immediately see. They can make the home dangerous, unfit for the buyer’s purpose or otherwise unsuitable. Some examples of these include:
- Cracks in the foundation the owner covered up
- Water intrusion
- Property additions or changes for which the owner did not secure permits
- Use of the home to grow large amounts of marijuana without remediation
If an owner knows about these or other material latent defects, they must say so in documents.
What don’t sellers have to disclose?
Many buyers would also like to know specific details of a home that affect their decision but aren’t related to the property’s condition. However, in Alberta, sellers are not required to disclose so-called stigmatized property information.
For instance, sellers don’t need to notify potential buyers if they believe the home is haunted or if a death or crime occurred on the property.
Issues that can arise
Homebuying is a major decision, and buyers should feel confident they know what they are getting. Simultaneously, sellers typically don’t want to volunteer information that makes the property less attractive.
Thus, disputes can arise if buyers discover negative aspects of a home after the transaction is complete. They may feel duped, but sellers may or may not have had an obligation to disclose specific information.
Under these circumstances, disclosures can come under scrutiny. If sellers covered up defects or failed to disclose them, buyers may take legal action seeking financial relief.