Real Estate Disclosure Laws: What Sellers Need to Disclose

Florida law does not provide an exception for a home that is sold “As Is”.  That means that the buyer agrees to take the home in its existing condition without the seller having to make any further repairs or improvements. However, the “As Is” clause does not relieve sellers from their responsibility to disclose latent issues that they are aware of that materially affect the value of the home. Florida law requires sellers to disclose these issues even if the buyer does not ask whether the seller knows about any defects.  Examples of such issues that could materially affect the value of a home can include:

1.) Environmental hazards such as asbestos, lead and mold

2.) Insect and pest infestations such as termites

3.) Electrical issues such as wiring or other problems with heating or air conditioning

4.) Foundation issues such as cracks

5.) Disputes about property boundaries or problems with the title to the home

It should be noted that sellers are not obligated to disclose any defects that are obvious such as a broken window or hole in the wall. Only latent defects which include those that cannot be seen during a normal inspection must be disclosed.  Additionally, the seller must have knowledge of the defect or issue at the time of the sale. To assist sellers in making all relevant disclosures, The Florida Association of Realtors has developed a 4-page standard form that the seller completes detailing their knowledge on the condition of many property characteristics such as:

1.) Claims Against the Property: are there any current or future claims or court proceedings that affect the property?

2.) Homeowners Associations: is the property subject to rules of a condominium or condo association?

3.) Property Boundaries: are there any disputes regarding the property boundary lines?

4.) Sinkholes: does the property contain any past or present sinkholes?

5.) Environmental Hazards: does the property have any asbestos, lead, mold or Chinese drywall issues?

6.) Key Home Components: are there any problems with essential components such as roof, plumbing, electrical wiring, heating and air conditioning systems?

Florida law does not require that sellers make such disclosures in writing. Such disclosures can be made verbally. However, if a seller makes oral disclosures, it may be difficult to prove in the event that the buyer purchases the property and later finds problems with the home.  For this very reason, it is recommended that the seller disclosures be provided in writing. If the buyer does claim to have discovered a defect that was not disclosed by the seller; it is the responsibility of the buyer to demonstrate the following:

1.) the seller was aware of the defect and failed to disclose

2.) the defect has a substantial impact on the value of the home

3.) the buyer was not aware of the defect at time of purchase

4.) the defect would not have been easy for the buyer to detect

The purchase of a home is one of the most important financial decisions that one will make.  To protect your purchase, it is recommended that buyers opt to have an inspection of the home performed by a licensed home inspection professional prior to closing on the property. The As Is agreement provides a clause that the buyer wishes to have an inspection conducted up to 15 days following the execution of the agreement. During this time, the buyer has the option to walk-away from the agreement should an issue be uncovered by the inspection and the seller fails to remedy.

Should you have any questions on the above or have an interest in buying or selling residential real estate in South Florida and not currently working with a Realtor, please do not hesitate to contact me at (954) 547-9483 or via email at jkenney10f@gmail.com.

Jay Kenney

 

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