All About Real Estate Disclosure Statements
Managing a complex real estate transaction from listing through closing is a process that requires a team of experts led by a professional Realtor. Knowledge, education and experience are necessary in order to navigate through the twists and turns that most undertakings encompass. Perhaps more than any other document involved in a typical negotiation, the seller's real estate disclosure statement perfectly illustrates the need for an expert opinion. It is not something that an inexperienced seller should tackle single-handedly.
In Canada, each province has its own set of rules and regulations governing real estate disclosures. This is so because practice varies greatly. In Alberta, a seller’s disclosure statement is referred to as the Seller’s Property Disclosure Statement (SPDS). It is important to note that the use of the SPDS is not a legal obligation under the Canadian Civil Code; however, real estate agents, under their own ethics rules, have a duty of disclosure toward their clients. The SPDS represents the real estate industry’s effort to uphold this commitment.
The SPDS is designed to alert buyers to known deficiencies of a property. It is then the job of the buyer to conduct further investigation on the problem with a qualified home inspector. The form covers all elements, including the mechanical systems, in a structure from the basement to the roof. The seller’s responsibility, in turn, is to answer each and every question posed by the buyer truthfully. Once alerted to potential setbacks, the buyer can subsequently decide whether to pursue the home or otherwise.
The Real Estate Commission of Alberta (RECA), while not advocating the use of a specific disclosure form, maintains that both patent and latent defects of a property must not be concealed. Patent defects are those that are readily visible and apparent, while latent defects are those that are not. A hole in the wall and crumbling steps are examples of patent defects, while a basement that appears dry, but is prone to storm water flooding is a latent defect.
Disclosure in Canada is a tricky issue since the rules are a bit ambiguous. Statutes differ with residential and commercial properties. Moreover, with the trend toward more consumer-friendly legislation, many are interpreting the seller’s disclosure duty to extend to topics such as condominium association fees, historical district restrictions and pending assessments. One highly controversial area had to do with a disclosure related to the so-called “stigmatized properties", where gruesome crimes had taken place.
The best approach for sellers contemplating the sale of a property is to gather all records related to their home’s history and sit down with a Realtor who is trained in the nuances of local disclosure requirements. While ensuring compliance with the directives, Realtors, being the most qualified, will protect the sellers' well-being without reservation.
Are you buying or selling a home in Calgary? Do you want an agent who has the enthusiasm and energy to get things done, with your best interests in mind at all times? Contact me at 403-617-8758, firstname.lastname@example.org or www.kellymacdonald.ca and let's make good things happen!
About Kelly Macdonald
Kelly Macdonald is a Realtor® with The Real Estate Company in Calgary, where she has been living (and loving it!) since she was 10. Kelly offers her clients a unique mix of youthful vigor, creativity and technical and design savvy on one hand, and professionalism and transactional expertise from her business degree and strong administrative background on the other. Kelly is also a devoted wife and mother of two, with whom she finds time from her busy schedule to play scrabble and walk by the beautiful lake of their home in Southeast Calgary.
THIS ENTRY WAS POSTED ON May 7th, 2015 BY Kelly L. Macdonald | POSTED IN General