Humber/Ontario Real Estate Course 3 Exam Practice

Under the REBBA Code of Ethics, what must salespersons disclose about sporadic basement leakage?

1. Leakage only if it occurs at the time of viewing

2. Leakage only if specifically asked by the buyer

3. Unnecessary, as it is a non-recurring issue

4. The information is a material fact and must be disclosed regardless of timing

5. Information to potential buyers but not needed for listing records

6. Only if the seller permits disclosure

The correct answer is: The information is a material fact and must be disclosed regardless of timing

The correct answer reflects the principle that any information about a property's condition that could influence a buyer's decision is considered a material fact and must be disclosed. In the context of sporadic basement leakage, this issue can significantly affect the buyer's perception of the property's integrity and potential repair costs. Thus, it falls under the obligations set forth by the REBBA Code of Ethics, which mandates transparency about known defects or issues with the property, regardless of the timing of the leakage or whether it is currently occurring. This approach ensures that buyers can make informed decisions, protecting their interests and the overall integrity of the real estate profession. Salespersons must prioritize ethical standards and disclose such facts to maintain trust in the real estate transaction process.