Rogers TV – Episode Two of Ottawa Experts (flooding)

The second in my new TV series, Ottawa Experts: Real Estate, went much more smoothly than the first. The earbud fit this time (last time, I couldn’t use it because it kept falling out). That meant  I could actually hear my producer giving me countdowns to breaks, which really helped me navigate through the hour.

Lawyer Mark Arbique and mortgage broker Cathy Macdonald, my two guests, were comfortable enough with the format having done a pre-series shoot that they were old hands. All in all, it went well; they were terrific. 

Because the show was airing in the midst of the Frankenstorm that threatened Eastern Ontario, we thought we would start things off by talking about flooding and water damage.

No real surprises there. A flooded property, even after it’s been repaired, can take longer to sell, particularly if the house is in a flood-prone area. Some insurers won’t insure it either. And  some buyers see it as a stigma property, even if the city has repaired the sewers and pipes and installed back-up valves.

Mark pointed out that you really need to check the fine print in your insurance policy and see what’s covered before you run into problems. Not all policies cover flooding; some won’t cover seepage, and others don’t cover acts of God. You may need a special rider for water/flooding issues, and as Mark points out, insurance companies are in business because they find ways of avoiding claims: make sure you know what the exclusions are in your policy.

If you own a home that was flooded once, or suffered water damage, make sure to tell your realtor everything.

As far as disclosure to third parties goes, if you’ve repaired all the water damage so that it’s like it never happened, Mark’s view  is that you don’t have to disclose it. The rule caveat emptor (buyer beware) still applies in Ontario, but there are two exceptions.

The first is if you complete an SPIS (Seller Property Information Sheet). Once you do, you have to disclose all the damage and the repairs that were made.

(By the way, both Mark and I agree that SPIS’s are not a great idea for a vendor to complete at all. They can expose a seller to liability because of the way they’re worded and there are other ways to make sure you make the necessary disclosures. As a former lawyer, I never use them.)

The other exception is if a buyer asks you directly, you have to tell. So if you’re the buyer, it’s a good idea to have your realtor ask if there’s been water damage or flooding that’s been repaired.

Personally, I think the seller should disclose any fact that might affect a buyer’s decision as to whether they would buy, regardless of what the law requires. That just strikes me as the ethical way to proceed, and is probably the safest course of action.

Luckily, we were spared (or have been so far) from the really damaging rain and wind that hit so many parts of the Eastern US and Canada. The rest of our discussion was all about first time buyers, and while we didn’t have any callers,  I had an email from someone who watched the show who said he didn’t call because we answered all his questions. In fact, we all heard later from people who watched the show so it’s good to know it’s developing a bit of a following.

Next show will be November 12 and it will be all about Downsizing. Hope to see you then!

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