Real Estate Talk: Seller’s Declaration

The Seller’s Declaration must indicate the condition of a property to the best of the seller’s knowledge

By Joseph Marovitch

Updated October 18, 2023

When selling a residential property with a broker, the seller is required to complete a Seller’s Declaration stating the condition of the property to the best knowledge of the seller. The broker must then place the document on Centris with the listing. The listing cannot be entered on Centris without the Seller’s Declaration for a residential sale.

The declaration must be truthful in that each question answered must be accurate. Whether the seller knows the answer or not, they must answer “yes”, “no”, “do not know”, or “N/A”.

What the seller cannot do is withhold relevant information they are aware of that can devalue the property. The buyer is providing an offer based on criteria the buyer needs, on the visit and the information in the Seller’s Declaration. Because all issues are declared in the Seller’s Declaration, the amount of the offer has already considered those issues.

In other words, if the Seller’s Declaration states the house requires a new roof, the offer accounts for the roof, therefore the buyer cannot negotiate a lower offer after inspection because of the roof. The buyer has already accepted that a new roof is required before providing the offer.

What the seller cannot do is withhold relevant information they are aware of that can devalue the property. The buyer is providing an offer based on criteria the buyer needs, on the visit and the information in the Seller’s Declaration.

Another rule that applies to the Seller’s Declaration is if the property received prior offers that did not go to signing and an inspection took place, the seller is required to amend the Seller’s Declaration to state there have been previous inspection reports. The seller does not necessarily have to provide the inspection report, however, if the report states an issue that can significantly reduce the value of the property, the seller must declare the issue.

The problem with this is some buyers will have an inspection report prepared for the purpose of getting the seller to reduce their price. If the seller does not believe the report to be accurate, the protocol the seller must follow is to have their own inspection performed to refute the buyer’s inspection report. The seller must then declare both reports in the Seller’s Declaration.

In the end, as long as the seller has declared other reports, it is up to the buyer to have their own inspection and decide for themselves.

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Next article: Home Staging

State of the market

Bank of Canada’s interest rate 5%
CPI today (inflation rate) 3.8%

‘Do not pay more than a property is worth. Whatever is purchased, make sure it is easy to sell.’

The inflation rate dipped slightly by .3%, not enough to affect interest rates southward. There appears to be a trend of country homes entering the market, but not much demand. Many second residences were purchased as primary residences during the pandemic at high prices. However, now that those buyers realize they do not want to live in the country full-time, the properties are being put up for sale.

The problem is interest rates are much higher than when these properties were purchased, and the market values of these properties have plummeted. If considering a second residence by the lake or mountaintop, wait a little longer. Prices may come down significantly. If you own a second residence and do not have to sell now, don’t sell.

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