Selling your house is often a complicated process.
It’s natural to want to present your home in the best light.
But it’s crucial to remember that you are legally obliged to disclose problems.
In the blog below, we’ve outlined what you must disclose when selling your house.
Why full disclosure matters
The housing market as a whole benefits from transparency. The law is set up to aid this as much as possible.
Most property transactions rely on large loans (the exceptions being ones involving cash buyers). To secure these, buyers need to provide lenders with as accurate information as possible.
And on the seller’s end, disclosure helps create evidence of property’s condition at the time of sale. This prevents legal action against sellers later on, which could be driven by fraudulent claims or simple misunderstanding.
Below is a list of the issues that should cover most issues.
They are all ultimately similar to issues that would raise red flags on house surveys. However, some might not get spotted during surveys, and rely on disclosure (such as number 3 below, ‘Disputes’).
1. Structural issues
Disclosing anything related to your property’s physical integrity is arguably the most important point.
Structural issues can be dangerous and expensive for buyers to rectify. Examples include:
- Subsidence
- Cracked walls
- Flooded basements
- Woodworm infestation
- Other stability or foundational concerns.
It’s also important to list any surveys or engineer’s reports that detail these structural issues. This demonstrates that the problems are not speculative and have been identified by professionals.
Structural changes
Additionally, it’s essential to disclose any significant renovations or changes made to the property’s fundamental structure. For example, you may include information on:
- Extensions
- Loft conversions
- Removed walls
- Converted basements.
You should also pass along any permits for these significant works to the buyer. Any planning or building regulation issues that arose during construction should also come to light.
The goal is not just to disclose but to provide a comprehensive picture of the property’s structural condition from the outset.
Can you sell a derelict property?
Properties with issues that make them unlivable are classed as derelict.
You can actually sell derelict properties. Of course, you would not just disclose this, but market this fact, too.
Buyers would likely be developers or investors looking to repair these serious issues and then sell the property for a profit.
2. Environmental issues
Home sellers are responsible for informing buyers about any environmental issues that could affect the property or their enjoyment of it. This includes:
- Ground and water contamination
- Radon gas
- Excessive noise
- Air pollution
- Proximity to high-voltage electrical supply lines and other sources of electromagnetic fields.
Some buyers may be concerned about these issues, so transparency is essential.
Flood issues
If the property is at risk or has a history of flooding, buyers need to know:
- How frequently flooding occurs
- Whether flood defences are in place
- Exactly what damage came from flooding in the past.
Provide any surveys assessing environmental issues so buyers can understand the full scope of risks and make an informed decision (including whether or not to get flood insurance).
3. Disputes
Common disputes that sellers will need to reveal include:
Boundary disputes
Property’s boundaries are both important but sometimes unclear.
Neighbours may claim that you or a previous owner has erected a hedge or fence in the wrong location, for example.
Access rights disputes
When neighbours or others dispute access rights to the property, such as a shared driveway, sellers must inform buyers. The buyer can then further investigate the extent of the access rights.
Covenant breaches
Neighbours or the local authority might claim a restrictive covenant has been violated through an extension or renovation.
Noise complaints
If houses nearby have a history of excessive noise, from music, shouting, pets, or any anti-social behaviour.
4. Third-party rights
Easements
Easements cover a range of issues. For example, a neighbour may have rights of way over a driveway or footpath crossing the property. And utility companies often have easements to access lines and pipes on the land.
Flying freeholds
Where part of the property overhangs or extends into a neighbour’s airspace, the neighbour has certain rights.
Previous owners may have retained rights to access mines or resources below the property’s surface. Ensure prospective buyers know whether this is the case with your property.
Wall ownership rights
With terraced houses especially, adjoining owners may have partial ownership rights to walls, requiring disclosure.
User covenants
A previous owner may have a covenant, such as the right to continue using a garage, garden area, or other on-site facilities if they require continued access.
Light or drainage rights
Neighbours may have legal rights to receive natural light through the property’s windows or drainage across the land.
It’s crucial to disclose these rights to potential buyers, as they must be aware of any possible limitations on their use of the property.
5. Informal arrangements & shared spaces
Along with disputable claims, sellers should also disclose any informal or handshake agreements that may affect the property.
For example, many people have loose arrangements with neighbours about:
- Shared driveways
- Fences
- Drains
- Pipes crossing property lines.
Or other interdependent spaces.
6. Pest Infestations
Pest infestation is another common problem in properties that sellers must disclose. This includes:
- Rodents
- Woodworms
- Wasps
- Cockroaches
- Bed bugs.
You must also point out any cracks, holes or conducive conditions for pests.
7. Insurance issues
A property’s insurability can also factor into a buyer’s decision.
Buyers should know if insurers have denied coverage or only offered insurance at higher premiums in the past. And you should provide details on the current insurance policies in place, including:
- The types of coverage
- Noteworthy exclusions
- Any recent claims made.
These can impact future insurability and premiums.
8. Other factors
Beyond these main disclosure categories, sellers should also highlight any other notable issues that might influence the buyer’s decision. This includes things such as:
- Pet smells
- Mould risks in damp areas
- Any stigmas – for example, a previous crime committed on the premises
While some of these might be awkward to disclose, transparency is vital.
