Disclosure When Selling Property

 

Opportunity in Castor BayNo property is perfect, but to entice buyers you want to show off the best points about the house you are selling. There are certain things that you will need to disclose, however.

Your real estate agent is obliged to inform the buyer about any defects or risks relating to the house or property. While they will want to obtain a good purchase price for your benefit and theirs, they also need to be fair to the buyer without misleading them.

To minimise the possibility of complications, disputes and damages claims for undisclosed issues, tell your agent about all the things a new buyer will need to know right at the beginning of the process of selling your property.

Building consent
If you have made additions to the property, provide the necessary code compliance or building consent certificates so that the buyer knows that everything has been signed off properly. If there are any outstanding issues but the purchaser still wants the property as it is, the disclosed details can be written into the contract by your lawyer. To show the buyer that all work is up to date, New Zealand real estate agents can help you obtain a LIM (Land Information Memorandum) report, and Australians can organise a survey report and building certificate.

If your neighbour has proposed any work on fencing, trees or buildings that will affect your property, be clear about whether you gave or withheld consent, hopefully avoiding potential disputes for the new homeowner.

Property defects
It goes without saying that any known weathertightness issues have to be declared. Because the issue has been well publicised for years now, many house hunters will automatically ask if the house is a leaky building.

Check out whether there are any other problems affecting the durability or habitability of the house, and if you aren’t sure, get a building inspection done. Prospective buyers are always advised to have the building professionally checked, but selling a house with a report already done can be a good selling point.

If you uncover any issues, you can choose to declare them and hope the house will sell in its existing condition, or fix them up before listing the property.

If the property sale includes any chattels or fixtures that don’t work, the agent should know about them so prospective buyers can be told.

Sensitive issues
Agents also need to consider whether or not to divulge sensitive historical issues related to the property, such as drug manufacturing or a death, accident or vicious crime connected with the address. While this may put some buyers off, there are people who think this sort of information needs to be discussed. Ask your agent for the best approach and they can explain the disclosure laws for the area where you live.

Savvy buyers are becoming increasingly aware of the risks associated with buying a home in a location prone to natural disasters. Council reports should provide relevant information about natural hazard risks in the area.

Honesty is the best policy
Your agent needs to be able to answer any questions confidently, so it is always best to keep them in the loop about any property issues. If you aren’t sure what to declare or whether your home has any problems worth mentioning, a good real estate agent will be able to advise you about how to get your property checked professionally, and what to disclose to interested buyers.

Article supplied by Mortgage Express

2 Responses to “Disclosure When Selling Property”

  1. Sheryl Handley Reply

    Hi, I recently purchased my first home through private sale and the owners never disclosed necessary information. I have since had to pull out the kitchen and replaces the flooring due to ongoing leaks from hot water system and dishwasher. The external walls and floor in the ensuite needed to be replaced as flashing had not been put on the roof causing major water issues. None of this information was passed on at the time of sale and it has cost me thousands. I have now used up all my savings and very stressed. Is there anything I can do?

    • Tony White Reply

      HI Sheryl…You need to contact your lawyer. A private seller is not “in trade” and is therefore not bound by the Fair Trading Act. There is no requirement for a private seller to make any disclosures or even just tell you the truth. They can make misrepresentations or conceal defects and your only recourse is through common law. Buyer beware when you buy privately.

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