IN his latest “Ask the Expert” column for the Yorkshire Post, our Residential Property Manager in Harrogate JOHN ROBSON explores your legal position when sellers fail to disclose known defects when you are buying their property. Click here to read his article.

Question

I have had an offer made to buy a property accepted and instructed solicitors. I have applied for my mortgage and paid the application fee and have instructed a surveyor to inspect the property and provide a Home Buyers Report.

The result of the survey report has revealed there are a number of serious defects within the fabric of the house sufficient enough for me to decide not to proceed with the purchase. These defects were probably known to the seller owners who never mentioned them to myself when I viewed the house nor, I have been told, did they tell their selling estate agent.

Is this not “misrepresentation” and can I claim back from the seller the costs I have incurred with my solicitors and mortgage fees?

I feel that I should have been warned of these relevant maters at the time I made my offer and to discover them at a later date has caused me financial loss.

Answer

When you agree to buy a property the phrase “caveat emptor” applies which is Latin for buyer beware. Thus it is for this reason a buyer must satisfy themselves as to the state and condition of the property, following inspection and survey, before proceeding.

Thus the fact the seller did not disclose any known defects is not considered to be a form of misrepresentation. Under the provisions of the Consumer Protection from Unfair Trading Regulations 2008 the selling estate agents are obliged to disclose any material facts relating to the property that are within their knowledge in a clear and timely way. It does seem to be the case the selling agents were not made aware by the seller of the defects and if this is the case they are not in breach of the 2008 Regulations.

If it can be proven the agents did have knowledge as a result of the seller’s providing such information then a breach of the 2008 regulations may enable you to reclaim the wasted fees incurred.

Buying a house is the largest personal financial investment we all make and as such to proceed with caution, following survey, is essential. The various legal and survey procedures in place are there to protect the buyer consumer as far as possible and it is inevitable that a percentage of transactions fail as a result of matters revealed by the legal and survey process.

Statistics reveal almost one third of agreed transactions do not proceed resulting in abortive fees. I will not say “wasted” fees as the costs incurred serve to protect the buyer and allow an informed decision to be reached.

The RICS Home Buyer’s Report does require your surveyor to place a valuation upon the property inn its current state and condition. If the valuation is equal to the agreed purchase price then once the defects are rectified it may well be the case the value increases.   If the valuation is substantially less than the agreed price then you may wish to show the Home Buyer’s Report to the selling agent and re-negotiate the price with the seller. The seller is likely to come up against a similar problem with any other potential buyer prudently proceeding with a survey.

Alternatively you could ask the seller to purchase the survey report enabling them to lodge this with the selling agents to be available to a future buyer. If you decided to instruct the same solicitor once you have found an alternative property to buy the firm may agree to discount the abortive fees charged.

John Robson

Residential Property Manager with Milners Solicitors in Harrogate.

Milners new office address in Harrogate is 12 Princes Square