Property Disclosure Statement: What BC Buyers and Sellers Should Know

A Property Disclosure Statement (PDS) can provide important information about a home you’re considering buying in British Columbia. Completed by the seller, the document provides information about the property based on the seller’s knowledge at the time.

However, a PDS shouldn’t replace a home inspection or a buyer’s own due diligence. Instead, it’s one of several tools that can help buyers better understand a property before completing a purchase.

What Is a Property Disclosure Statement?

A Property Disclosure Statement is a form commonly used in BC real estate transactions to provide information about the condition and history of a property.

The seller completes the form based on their knowledge of the property. Depending on the property type, the questions may cover areas such as water, structural issues, renovations, permits, services and other property-related matters.

Importantly, there is no prescribed mandatory property disclosure form in BC. However, Property Disclosure Statements are widely used in real estate transactions.

Why Is a Property Disclosure Statement Important for Buyers?

For buyers, the PDS can be a useful starting point for due diligence.

For example, information in the statement may raise questions about previous renovations, water issues or other aspects of the property that deserve further investigation.

As a result, buyers can use the information alongside a professional home inspection, document review and other appropriate due diligence.

However, the PDS shouldn’t be treated as a substitute for an inspection. A seller can only disclose information they know about, and there may be issues they aren’t aware of.

What Does a PDS Mean for Sellers?

For sellers, completing a Property Disclosure Statement accurately and to the best of their knowledge can help provide buyers with useful information about the property.

BC sellers also have disclosure obligations regarding certain latent defects that a reasonable inspection wouldn’t reveal.

Therefore, sellers shouldn’t guess when completing the PDS or intentionally leave out known information that may require disclosure.

If you’re unsure about your disclosure obligations, discuss them with your real estate professional and, when appropriate, seek independent legal advice.

What Is a Material Latent Defect?

A latent defect is generally something that can’t be discovered through a reasonable inspection.

Certain material latent defects must be disclosed. These can include defects that make a property dangerous or potentially dangerous, unfit for habitation, or unsuitable for a buyer’s known intended purpose.

In addition, BC real estate professionals have disclosure obligations under the Real Estate Services Rules.

Because the circumstances can be complex, sellers should get professional advice when they’re uncertain about whether something needs to be disclosed.

What If a Seller Doesn’t Provide a Property Disclosure Statement?

A seller may choose not to provide a standard PDS.

BC now also has a Property No Disclosure Statement form for sellers who can’t or don’t wish to make representations about the property.

For buyers, receiving a Property No Disclosure Statement is a reason to conduct additional due diligence rather than simply assuming there are no problems with the home.

Your real estate professional can help you understand what additional investigation may be appropriate.

Does a PDS Replace a Home Inspection?

No. A Property Disclosure Statement and a professional home inspection serve different purposes.

The PDS provides information based primarily on what the seller knows about the property. A home inspection, meanwhile, gives the buyer an independent assessment of the property’s visible and accessible components.

Therefore, reviewing the PDS and completing appropriate inspections can work together as part of a buyer’s overall due diligence.

Property Disclosure Statements and Buying a Home in BC

A Property Disclosure Statement can provide valuable information, but it should be considered alongside inspections, property documents and professional advice.

Most importantly, buyers should ask questions when something in the disclosure requires clarification, while sellers should provide information accurately and to the best of their knowledge.

If you’re buying or selling a home in New Westminster, Burnaby, Coquitlam or elsewhere in Metro Vancouver, the Adam Lloyd Home Selling Team can help you understand the documents and due diligence involved in a real estate transaction.

Contact The Adam Lloyd Home Selling Team, we can help you understand what’s currently available, where the best value is and how to compete in this price range. Reach out anytime for a no-pressure conversation.

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