The Building Inspection shows Material Defects: What should I do? (Dec /2020)

As an Interesting 2020 Closes, We Ponder Our Future.

• 
• By Nancy Smith
• Qualicum Beach REALTOR®
• Published: Dec 29th, 2020 at 12:12 pm

Purchasers requiring a mortgage, are generally financially stretching their resources, so they are more cautious about facing unexpected major expenses, such as a new roof, or blocked drainage. A building inspection will(should) reveal any obvious potential material defects, and when that happens, what is the next step?

Generally the purchaser will have to evaluate the impact of such defects and have several choices:
1) Remove the conditions and proceed with the original agreement
2) Approach the seller, and ask them to address the issues before sale completion
3) Ask for financial compensation to offset the purchase offer.
4) Withdraw the offer to purchase.

This is often a personal decision, where one of my clients actually worked with heavy equipment, so they were not concerned the septic field may soon need upgrade. Another client was a handyman, so they were able to install new roofing material at a lower cost. Another client's inspector found four inches of water in the crawl space, the owner was horrified and had the drains instantly unblocked at their expense.

Material defects should not scare you from following up on an offer to purchase. Instead, consult with experts who can outline potential costs and
consequences where they may offer solutions that will make the home more desirable.

It really is a personal choice, based on past experiences, knowledgable assessments and your goal. Some properties only become available once in a lifetime, so do not panic.

Reference:

In common law, a seller, and correspondingly, a seller’s agent, must disclose all known material latent defects. A latent defect is one that is not visible upon ordinary inspection, but which materially affects the property’s use or value. On the other hand, a patent defect is one that is readily visible and/or obvious upon ordinary inspection. A patent defect may also materially affect the property’s use or value.

Written disclosure of a material latent defect is required regardless of whether the real estate is offered for sale or for rent or lease. Section 5-13 of the Rules also provides that if the client instructs the licensee not to disclose the material latent defect, the licensee must refuse to provide further trading services to the client in respect of the trade in real estate.