Profile picture for BonnieMikoleit

Do real estate sales have to include full disclosure on major structural problems?

  • July 19 2012 - Orange
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Answers (13)

Profile picture for Primford Homes

You should want to disclose any Major Structural Defect to the property. If you know of the problem and knowingly hide from buyers, you are just asking for trouble.

As a Real Estate Professional, my responsibiltiy is to ensure that any defects are made known to avoid any issues.

  • May 20 2013
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Disclose, disclose, disclose. If you're aren't sure, disclose. Better to give the buyer too much information than be sued after closure.
  • May 19 2013
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I, for one, want to know about defects before closing, and I have no experience with agents to the contrary.  Pasadenan, you seem like a magnet for bad houses and agents. 

It is comical that agents and sellers market scrapers as needing TLC, but the fact is that the door is open for buyers to examine the home to their satisfaction. 

Real estate brokers are not (generally) licensed contractors, inspectors, or building specialists - any more than antique dealers are artisans or patent attorneys are inventors.

Still. Brokers do provide value to clients, and in recognition of the specialization of practitioners, states license real estate brokers separately from home inspectors and contractors.
  • July 20 2012
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Profile picture for blue screen exile
Another home I looked at and made an offer on, the owners had cut all the composition roofing shingles 5" shorter so that they would look "newer" from the ground, removing the signs of wear.  Clearly the owners must have known the condition since they did it?  It was not disclosed, and needless to say, they were not willing to provide a new roof nor reduce the price for the cost of the roof, even though clearly there was no life left in the roof after so much of the roofing was "removed".  Neither the listing agent nor the multitude of buying agents that saw the house noticed this major "defect" as you need to be closer to the roof to see what was done.  It was not obvious to the casual observer from the street, nor approaching the house at ground level.

It would have been obvious with a good zoom lens on a camera though, if I had thought to check it and didn't want to get a ladder to be able to reach the roof.

They don't tell you "buyer beware" for nothing.
  • July 20 2012
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Profile picture for blue screen exile
If a listing agent "wanted to know", they would have the seller hire an excellent home inspector prior to listing... (or the listing agent would pay for an inspection themselves)  but then the seller would either need to correct the items or disclose them.  And this is not only an unnecessary additional expense, but would affect how favorably a house could be represented in the listing description.

As with all marketing, the goal is to "make the sale", not "provide the truth".  No, not over 99%, maybe only 75% or 80%.  I have no way of measuring it.  But I do know that most of the homes that have structural issues are not going to say so in the listing, regardless if the agent has any clue about the issue or not.  And I do not believe most of them are intentionally trying to lie to potential buyers.  Since it is so easy to "find out" the conditions... the only answer can be "they don't want to".

Yes, some will be advertised as "fixers", or the more euphemistic phase typically used in the copy... "needs TLC".  But for getting the highest net proceeds for the sale for their client, they prefer not to list a home as a fixer if it doesn't "look" like one.  They only are required to disclose what they know, so a large majority simply prefer "not to know".  And when asked, they will tell you they are not an inspector nor a contractor nor an engineer, thus if you are concerned, you should hire the appropriate professionals to review it for you.

  • July 20 2012
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So, I'm not stating that "all" agents want to avoid knowing, only a very large portion of them.

99.9999 percent?

There's a distinct difference between knowingly deceiving and being ignorant of construction methods. I think your posting proves that either can be true when it comes to real estate agents.

  • July 19 2012
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Profile picture for MiamiCondosandHomes
They should. The more they know about the condition of a home, the more likely their sale will go smoothly from contract signing to inspections. It is in no one's best interest to be intentionally deceptive in this instance.
  • July 19 2012
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Profile picture for blue screen exile
Typing error and too long to edit...

they duct near --> they *dug* near
  • July 19 2012
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Profile picture for blue screen exile
One home I made an offer on, when the selling agent was showing it to me (not the "listing agent") I asked where the heater was, and stated I wanted to see it.  The agent stated she didn't know, but believed it was under "that" closet", but that we shouldn't look now, and that my inspector would check it out.

So, after I make an offer and hire an inspector, and it is "checked out", it turns out that the seller replaced the floor heater with a ducted heater, but put the heater straight in the dirt under the house with no foundation or housekeeping pad.  and worse, they duct near some of the house footings to get the clearance they needed, undermined the footing, and did nothing to address this structural issue.  When I asked for it to be either corrected, or the price reduced sufficiently so that I could correct it, the seller took it off the market.

Now, my "agent" had over 30 years "experience".  Since the agent directed me away from looking at the potential issue, do you think the agent already knew?  Do you think the agent intentionally hid the condition and trying to mislead me?  The agent "claimed" the house was move in ready and that it met my search criterion (which it didn't because the garage wasn't even adequate for my stated needs).  Or do you think the agent was just intentionally ignorant of a condition they didn't want to know about?  Either way, the agent claims ignorance, and there is no way to prove otherwise in court, nor even at a local board hearing.  Besides, they always make you sign that "arbitration" agreement anyway so that their friends can arbitrate such disputes to rule in their favor.

And if you read very many of the posters on this site, you will find that most of the agents posting do not really have very much construction experience.

So, I'm not stating that "all" agents want to avoid knowing, only a very large portion of them.  Their goal is to make the sale.  Not to find things to discourage the sale.
  • July 19 2012
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No, of course not.

Sellers and agents have to disclose what they know, but an executor for an estate, for example, will probably not know about any problems - major or minor.

I want to take issue with the idea that real estate agents "want to not know." To the contrary - the more we know going into the sale, the less we'll have to learn at a disposition after the sale.

  • July 19 2012
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Profile picture for wetdawgs
As you've posted in home buying, am I to assume you are in the buying process?  I'll answer with that perspective.

Sellers are required to fill out a disclosure statement,  but the best seller can only fill out the disclosure statement to the best of their ability.   They may not know that termites are in the structural timbers in the east wall, they may not know the roof is missing a couple of shingles.  

So, a disclosure statement is a good starting point but is not a substitute for an excellent home inspector who goes in the attic, below the house and all around.   It is not unusual for the inspector to find something(s) that the seller didn't know about.   This is part of the reason for an inspection contingency in a purchase offer.
  • July 19 2012
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Profile picture for blue screen exile
They only have to disclose what they "know", and most agents will make sure they don't know.  And most owners will not know if no-one told them.

And even if they were told at one time, the disclosure statement is what the owner knows at the time of filling out the form.  So typically "I forgot" is an adequate excuse in court, as long as it was clear there was no intentional fraud.

It is the buyer's responsibility to have appropriate inspections prior to buying anyway.  If there are signs indicating a potential structural issue, a buyer's home inspector should be recommending additional inspections or review by a civil or structural engineer.

Most cracks are cosmetic related to normal thermal expansion and normal building flexing, and are not structural issues, and very rarely "major structural problems".  Any experienced building inspector should be able to spot signs of the difference requiring review by someone with more experience, or even measuring movement over time.
  • July 19 2012
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Absolutely yes!  If the major structural problems are not disclosed before title transfer and the seller (and broker)and selling agent knew about them, the buyer can come after them with litigation or, hopefully, settlement before litigation.
  • July 19 2012
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