Real estate agents must honor the line between staging and lying

On Behalf of | Sep 19, 2022 | Real Estate Law

When a seller hoping to list a piece of Georgia real estate for sale contracts with an agent, they likely have several goals. The first is that they don’t want to handle all of the details of the transaction themselves and would prefer to transfer that responsibility to a licensed professional. The second is likely that they want to get as much as possible for the sale of the property, and they count on an agent to give them appropriate advice to maximize the final sale price of the property.

You can help a seller set a reasonable price for a property. In fact, your advice could help them convince buyers it is worth more based on how you make the property look. Staging a property to make it appealing to buyers is an important part of the real estate closing process.

However, especially if you target certain visual defects in the property with short-term repairs, you must ensure that the seller properly discloses those defects.

Certain kinds of staging could endanger you and the seller

As a real estate agent, your professional reputation could be at risk if people accuse you of selling money pits and intentionally covering up defects within the property. Although you may not feel responsible for a buyer’s failure to perform their own due diligence, an unhappy home buyer could make a claim against your errors and omission insurance coverage by claiming you failed to disclose the defect.

An unhappy buyer could also take you or the seller you represented to civil court or make a claim against your professional license. If they can show that you knew about major issues with the property but did not disclose those problems in writing, they could have grounds for successful claims against you or your client. If they can show you sought to hide certain issues prior to the closing, their claims could have financial or professional consequences for you.

How can you and the seller protect yourselves?

The simplest way to prevent expensive insurance claims or defect-related litigation following your real estate closing is to thoroughly disclose all known defects with the property in writing, even those that you have tried to make less aesthetically obvious while staging the property.

There is nothing inherently wrong with completing certain cosmetic repairs to the property, provided that you also make a point of fully disclosing the underlying issues to all prospective buyers. Learning about and carefully adhering to Georgia residential real estate laws during a transaction where you represent the seller will help you protect your career and your professional reputation.