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How Honest Are Sellers on Property Disclosures?
By Melissa Dittmann Tracey
Buyers may want to think twice about nixing the inspection contingency. A study found that 94% of sellers admitted that they didn’t disclose a known issue.
CHICAGO – Homebuyers who waive the inspection contingency must rely heavily on seller disclosures to be informed about any potential problems with the property – but more than 90% of buyers say they found at least one issue with their home after the transaction that the seller didn’t disclose, according to a new survey from Cinch Home Services, a home warranty company.
Even more alarming is that 94% of sellers admit to selling their homes without disclosing a known issue.
“Sellers failing to disclose home damage is against the law in most states,” says Cinch spokesperson Bella Valentini. “To ensure protection, prospective homebuyers should ask for a completed seller’s disclosure in addition to conducting a thorough home inspection before closing on a new home.”
The top three problems buyers discovered after closing involved the electrical system, fixtures and plumbing. The survey shows the majority came from unpermitted repairs and upgrades, suggesting sellers should rethink doing some DIY jobs.
Problems buyers found after closing
- Electrical: 88%
- Fixtures: 58%
- Plumbing: 58%
- Exterior structures: 54%
- Basement: 52%
- Water Damage: 46%
- Heating and cooling: 43%
- Exterior façade: 42%
- Mold or termites: 39%
- Major appliances: 34%
- Roof: 31%
- Foundation: 27%
Source: National Association of Realtors® (NAR)
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