Property Disclosure Statements

Global TV ran a news story last night (link) regarding a couple that bought a house that had been previously gutted by fire.  The problem was that this had not been disclosed by the previous buyer and the buyer is now saddled with a $200K bill to repair even though it is obvious that the previous vendor would have been aware of this damage.

The problem with property disclosure sheets (PDS) is that they are seldom filled out in an accurate manner.  The vendor may not know or may just lie about the condition of the home.  I have often seen deficiencies in homes that are very visible yet not identified accurately on the PDS.  There also does not seem to be any enforment of the document and limited opportunities for recourse.

SENWI has long advocated to change the laws regarding the PDS.  We feel, that like a car, ALL significant repairs or renovations over $5K should be registered against the property.  A purchaser should be able to receive a report from the land titles office, as part of the purchase conditions, that provides the full history of the home.  Contractors and Municipalities should be required by law to register their activities with the dwelling (like renovations, attendance by fire services for fires, floods, grow ops., storm damage, mechanical damage from vehicles, etc). 

For now however, buyers should not place any faith in a PDS (only pay attention to defects positively identified as being present and ignoring those that are identified as unknown or not present).  Buyers should always hire an independent home inspector (not the one your agent recommends). An independent home inspector will work for you (and only you) and attempt to reduce your liabilities in buying a dwelling that you have no previous knowledge of by means of a thorough and detailed inspection of the dwelling.