By Sean Kaulback
Whether you are purchasing or selling real estate, the Property Disclosure Statement or PDS (formerly known as the Property Condition Disclosure Statement or PCDS) is important to understand, as its purpose is to protect both the purchaser and the seller.
A PDS is a standard form document that allows the seller to convey the condition of the property by answering various outlined questions to the potential purchaser. These questions are answered solely on a knowledge basis so if the seller is not aware of the answers, they have the option to state that. The document is then signed and acknowledged by the purchasers to state they have received the disclosure. The PDS is important because it can prevent future disagreements about what information was communicated regarding the condition of the property.
From a purchaser’s perspective, the PDS provides fundamental information regarding the property. This includes information about the structure, heating, electrical, plumbing, water and sewage. It will also include work that has been completed to the property and current specifications of equipment in the property such as the electrical panel, septic system, well or hot water tank. The work completed can be especially useful to a property inspector, as it can allow them to further investigate specific issues, such as if a basement leak was fixed in the years prior.
From a seller’s perspective, the PDS allows for a limitation of their liability with regard to the condition of the property. The PDS serves as a written and signed record of the disclosure by the seller to the purchaser.
While there are instances where a PDS cannot be provided, in cases where they can, they serve as limitation of the seller’s liability and an excellent source of information for the purchaser.
This article is for information only and is not intended to be legal advice. If you have any questions or would like further information, you should consult a lawyer.
