It can be assumed that no property will ever be perfect, sellers and purchasers are equally aware of this. However, when selling your property, it is in your best interest to not conceal and/or be untruthful about any defects that you are aware of.
Should the temptation to be dishonest arise, it could result in a legal dispute which can be detrimental to any profit you hoped to make on the sale of your property.
Often estate agents make use of the defects disclosure list when they have been mandated to sell your property indicating all existing defects on the property.
The South African Government is currently working on replacing the Estate Agency Affairs Act with the Property Practitioners Act which, once signed into law, will make the completion of a defect’s disclosure list compulsory.
The defects disclosure list will be included in all agreements of sale, which will eliminate the need for future disputes about defects you may or may not have disclosed to your estate agent and purchaser.
When we refer to defects in a property, they can be placed in two categories namely patent and latent defects.
Patent defects refer to any defects or problems on the property that would have been visible to the naked eye.
Latent defects refer to defects or problems that the reasonable person would not have known about before purchasing the property, for example a slow leak in a wall that eventually gives rise to mould weeks after transfer has taken place.
Disclosing any known defects to your estate agent and any potential purchasers could actually be to your benefit.
It can be reasoned that a purchaser who is aware of all defects might be more willing to meet your asking price knowing that there will be no “surprises” in store for him/her in terms of repair costs which they have not budgeted for.
A reduction in your asking price due to defects that have been pointed out to the estate agent and potential purchaser, could be far less than the costs of a legal dispute should the purchasers be of the opinion that they were deliberately misled and sue for damages.
Our Property Law Department and Conveyancing Attorneys in Cape Town provide specialised services over the full spectrum of commercial and residential property.
Contact us for more information about how we can assist your property sale or purchase.
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