Real Estate Agents, under all circumstances and regardless of any fiduciary obligations to their client, must always disclose material facts. Indeed, real estate agents must seek out and uncover material facts so they can disclose them to all parties in the transaction. A material fact is any factual information that could impact the decision of a buyer to buy or a seller to sell. This includes, but is not limited to, the following:
* Zoning, infrastructure projects, flood zones and private roads
* The ability for the buyer to buy or the seller to sell.
* Property easements, encroachments, needed repairs, deed restrictions, occupancy limitations and covenants.
* Presence of a cemetery (but not hauntings or other stigmatized property situations)
* Square footage, unpermitted additions, septic capacity, assessments
* Anything specifically indicated by the buyer or seller.
That last one seems like a big catch-all so let's take a closer look at it.
The ability to put a pool in the backyard of a home is not, by itself, a material fact. But if the buyer mentions to their real estate agent that it is important to them to have a home where they can put in a pool - that becomes a material fact. As a material fact, the real estate agent must work to determine if a pool can be installed. The agent would need to review the covenants and deed restrictions, provide these documents to the buyer and recommend the buyer include a review of the property with the city as part of the buyer's due diligence. And if the real estate agent learns that a pool can not be installed, the real estate agent must disclose this to all parties in the transaction.
As another example, if the real estate agent is touring the property and notices moisture on the basement wall, the agent needs to inquire about the reason for the moisture, request any repair documentation to prove repairs were completed and disclose this information to all parties in the transaction. This must be done even if the real estate agent's client does not want it disclosed.