REAL ESTATE ADVISOR ON SELLING A HOUSE
As an independent real estate advisor we tell people who are selling a house to make sure they know the ins and outs and that means understanding what 'due diligence' is needed to protect them.
One of the issues often faced is about disclosure, or lack of, because failure to reveal important property information to the buyer in pursuit of a better price can have costly consequences for both buyer and seller.
DISCLOSURE WHEN SELLING AN APARTMENT
With building standards and cladding issues of recent years hitting the headlines, standards around disclosure specifc to selling an apartment have been put in place. It is important to understand what is required.
In a New Zealand example, a real estate agent's decision not to disclose information about a house resulted in the buyer being disadvantaged.
It is understood the vendor instructed the real estate agent to disclose important information to the buyer that would have impacted their view of the property, and therefore the property value.
However the agent did not disclose the information. The likely upshot was the buyer paid too much in this instance.
If you have information that should be disclosed to prospective buyers, to be sure it gets communicated, you might want to do this in writing and get it signed. We recommend you use a property lawyer to do this for you.
To find out more about disclosure, read on below.
Need to find out more about the real estate process and ensure you do due diligence? We are expert real estate advisors, independent of all real estate agent brands.
To find out where to start when selling your home, we can advise you on the right process to take to get the best price in the optimum time frame.
CONSEQUENCES OF NON-DISCLOSURE WHEN SELLING A HOUSE
Complaints to the Real Estate Authority
When a case like the above occurs, in the first instance, complaints can be made to the Real Estate Authority (REA). If deemed necessary, the REA can then refer the complaint to a Complaints Assessment Committee (CAC).
Where more serious misconduct has been determined, the CAC can refer cases to the Real Estate Agents Disciplinary Tribunal.
The Real Estate Agents Disciplinary Tribunal is appointed by the Ministry of Justice to investigate the most serious cases relating to real estate agent misconduct or appeals.
It has the power to order licensed agents or salespeople to pay fines up to $15,000, or order compensation up to $100,000 for financial loss to complainants. The Tribunal also has the power to suspend or cancel a real estate agent's licence.
Deliberate omission or non-disclosure to an agent by a seller about a property may end up costing you legal fees in addition to any remuneration owed to the purchasers should complainants take a case against you using the legal system.
NON-DISCLOSURE RULE OF THUMB
Don't mislead your agent or buyers, the consequences can be life changing for everyone involved.
Depending on the real estate agent, any property information that should be disclosed can be managed well - or poorly.
To ensure you have the best possible real estate agent to represent you and your type of property, we can short-list agents based on a specific criteria for your property type.
We can also connect you to people and resources that will help you manage issues that require disclosure. This is a free service so ask for help if you need it.