Humber/Ontario Real Estate Course 4 Exam Practice

What should a listing salesperson do if informed by the seller of occasional basement leaks during spring thaw?

1. Do not disclose the issue as it is not considered a material fact.

2. Obligate to inform clients but not customers about the issue.

3. Only disclose the issue during the spring thaw when dampness occurs.

4. Disclose the basement dampness as it is a material fact despite its seasonal occurrence.

5. Wait until a buyer specifically asks about the basement condition.

6. Require the seller to repair the basement before listing.

The correct answer is: Disclose the basement dampness as it is a material fact despite its seasonal occurrence.

Disclosing the basement dampness as it is a material fact is crucial for several reasons. Material facts are pieces of information that could affect a buyer’s decision to purchase a property or the price they are willing to pay. In this case, occasional basement leaks during the spring thaw represent a significant issue that could lead to serious concerns for potential buyers, such as water damage, mold growth, or structural problems. By disclosing this information, the listing salesperson ensures that all parties involved have a clear understanding of the property's condition, thereby promoting transparency and trust in the transaction. It allows buyers to make informed decisions and helps protect the salesperson and the seller from potential legal liabilities that may arise from non-disclosure of material defects. Knowing the history of basement leaks can influence a buyer’s offer, the terms of their financing, or their willingness to proceed with due diligence. The importance of transparency in real estate transactions aligns with the ethical and regulatory standards set forth in the industry. Therefore, acknowledging that basement dampness is a material fact, regardless of how often it occurs, is the ethically and legally appropriate course of action.