How Do I Protect Myself from ‘Invisible Issues’ when Buying a Property in Nova Scotia?
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Caveat Emptor – Buyer Beware
Real Estate law in Nova Scotia is grounded in the very old legal concept, ‘caveat emptor’, which is ‘Buyer Beware’. The idea being, no one is forcing you to buy the property, so before you sign on the (digital) line, the onus is on you to ensure you really want what they are selling.
Protect Yourself with Inspection and Disclosure Clauses
When you buy a house in Nova Scotia, you have the opportunity to include as many conditions in your offer to purchase as you’d like. However, the more conditions you place on your offer, the more opportunity the seller has to walk away from the deal. So it’s up to you to determine which conditions are critical to have included prior to committing to buy the Property.
The 5 Most Common Conditions to have in your Purchase and Sale Agreement to Protect Yourself when Buying a Home in Nova Scotia
A requirement that the current owner provide a Property Disclosure Statement;
an opportunity for your lawyer to review the title to the Property to ensure there are no ownership issues or liens as well as the agreement itself;
an opportunity to confirm you can get insurance for the property;
an opportunity to confirm you can get financing to buy the property; and
an opportunity for you to conduct a ‘home inspection’.
Relevant to the protecting yourself from unseen issues are #1 and #5.
What’s a Property Disclosure Statement?
A Property Disclosure Statement is a form the current property owner fills out to share with potential purchasers what they know about the present state of the Property. They sign it and in doing so say they are providing you with accurate information ‘to the best of their knowledge’. The PDS can be helpful – for example if they disclose they had to install a French Drain to channel water away from the foundation. However, despite a plethora of leaks in the attic from an old roof, the PDS may indicate that they have no knowledge of any leaks (because they don’t spend any time hanging out in the attic). They aren’t lying or providing misinformation. The form is true ‘to the best of their knowledge’.
What’s a Home Inspection?
A ‘Home Inspection’ can take any number of forms. It is most typically when the potential purchaser hires an ‘expert’ to come and kick the proverbial tires of the house and advise of any issues they uncover. This could be anything from faulty electric, corroded plumbing or air conditioning units that don’t work efficiently to a roof that needs replacing, leaky windows, mold or evidence that flooring has been replaced.
You can also have more than one inspection. For example, it’s not uncommon to have the septic system specifically inspected.
If issues arise, Ask Questions!
If any issue arises upon any of these inspections, the potential purchaser is then on notice that they need to dig a little deeper. It’s the Purchasers job at that point to ask specific questions to determine what, if any, related issues there have been and the extent of the problem. Depending on what the seller says, the Purchaser can then amend their offer.
If you aren’t happy, Negotiate
Sometime a potential purchaser will decide it’s not worth the risk, so they walk away from the Property. Sometimes, they reduce their offered purchase price (typically by the amount they anticipate it will cost to remedy the water issue and sometimes they will ask the seller to fix the issue themselves prior to closing).
However, if you skip the Home Inspection and/or don’t obtain a PDS and decide to buy the house anyway, you are putting yourself in jeopardy of buying a house with any number of undisclosed issues.
Remember, outside of the Property Disclosure Statement (which they only have to provide if you ask for it as a condition to your purchase) a homeowner is only required to disclose latent defects, not patent ones. (If you are wondering what’s the difference, check out our blog: Patent vs Latent Defects)
It’s up to you to determine whether you want to buy a particular property or not. It’s worth it to take your time and due your due diligence to investigate what is likely to be one of the largest financial investments in your life.
And if you’re reading this blog because you’ve discovered an issue in a home you’ve already purchased, check out our blog: What are my options if I Discover a Water Leak in a Home I just Purchased in Nova Scotia?
By: Dianna M. Rievaj, Founding Lawyer
Have Questions For Us?
If you have any questions about issues arising from the purchase or sale of real estate in Nova Scotia, you can call us at (902) 826-3070 or email us at info@highlanderlaw.ca to set up a meeting with one of our lawyers at our Tantallon law firm. You can also schedule a no commitment Issue Review Consult for $250+HST where you have the opportunity to explain your situation to a lawyer and get basic advice before deciding whether or not you'd like to retain us.
The information and materials on this blog are provided for general informational purposes only and are not intended to be legal advice. Nothing contained on this blog is legal advice or constitutes a legal opinion. While it is our goal to provide information which is current, legislative changes and court decisions, among other matters, may result in some information no longer being current or accurate. You should consult a lawyer before relying on any information. The views expressed herein by individual contributing lawyers posting entries to the blog are solely those of the authors and should not necessarily be attributed to or considered representative of the firm of Highlander Law Group Lawyers
