How To Deal With A Wet Basement When Selling Your Home
The real estate market is hot in Toronto and you may be thinking that now is the perfect time to sell. But what if your basement is leaking and wet? How should you deal with a wet basement when selling your home?
A leaky basement can represent more than just a crack in your foundation, there could be structural issues that must be addressed before you think of selling or you may find yourself in a situation where your buyers are either backing out of the deal or worse yet, suing you for non-disclosure.
If you are already working with a Realtor, let them know that there may be an issue with your basement. Get a Free Inspection by a professional to assess where the root of the problem is. Is it a simple problem with your sump pump? Or does the foundation need to be repaired to avoid future leaks?
Once you are ready to put your home on the market, it is your legal duty to disclose any water intrusion issues in the Seller’s Disclosure document.
The home seller is legally obliged to disclose the following to any potential buyers:
- Patent defects. A patent defect is one that is obvious when you walk into a home such as broken floorboards or a broken window. The buyer can’t claim to be unaware of this issue because is was visible during the viewing of the home. They must accept these defects on closing, or demand that the repairs are made by the seller as a condition of the purchase.
- Latent defects. A latent defect is one that is hidden and can’t be observed during a normal inspection. In Ontario, the law states that the seller must disclose any hidden defects that could make the home uninhabitable, unfit for the buyer’s intended purpose or dangerous to the buyer. These defects can include foundation issues and serious basement or roof leaks that have not been repaired.
What is a SPIS Form?
The seller’s property information statement (SPIS) is a form that some sellers choose to complete to provide additional information about their property. The SPIS is not mandatory and may require the assistance of a home inspector or real estate attorney to complete as it is a very technical document and could potentially open the home seller up to future litigation if filled out inaccurately.
A prime example of how important it is to disclose flooding prior, during or after the parties have entered into an agreement is demonstrated in the case of Soboczynski v. Beauchamp, which as of July 2015 has now been through three court hearings and may be headed to the Supreme Court of Canada. The details of this case are explained in an article from July 24, 2015 written by Toronto real estate lawyer Bob Arron which was published on TheStar.com.
“Back in 2007, Don and Louise Beauchamp decided to sell their property on Gardenvale Cr., in London, Ont. After inspecting the property, Adam and Olga Soboczynski submitted an offer to buy it for $290,000. The offer was accepted.
Before the conditions in the agreement were waived, the sellers delivered to the buyers a Seller Property Information Statement (SPIS) on a standard industry form which was provided to them by their realtor.
On the SPIS, the sellers stated that the property was not subject to flooding and that they would disclose any “important changes” to the buyers before closing.
The basement flooded before closing. The sellers dried out the wet rug and replaced the underpad at nominal cost, but did not disclose the flood to the buyers.
The basement flooded again after closing and the buyers sued the sellers for damages of $25,000 based on the representations in the SPIS.”
Read the full article here: TheStar.com
Does The Water Intrusion Have To Be Disclosed Even After The Problem Has Been Fixed?
Yes, any prospective buyer should be aware that there was water in the basement and that the problem has been repaired. This will give them the opportunity to investigate and inspect the work that was done and call in professionals to help assess the repairs that were made by the seller.
If you have had a professional come in and assess your wet basement, make sure you include estimates, contracts and receipts from the vendors to show the work that had been done.
You can also take preventative measures today to avoid flooding. Tony Romanelli from RCC Waterproofing explains in this article from The Toronto Star how to keep your basement dry and take action against leaks.
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