The property next to mine is up for sale. The house is a derelict which is beyond repair -- the foundation is toast -- and it has to be demolished in order to build a liveable dwelling.(I know...great neighborhood, you're saying...actually it's prime waterfront property, the houses are just very very old.)A buyer showed up and put a conditional offer on the property. What he didn't know was that the municipality won't issue a demolition permit in this area so he's basically stuck with an uninhabitable house.Both the vendor and the real estate agent were aware of the municipality's ruling but they didn't tell him. He can get out of the deal but it'll cost him $5000.The question...should the agent have informed him that he couldn't demolish the house or is it a case of buyer beware?

Ha ha ha ha. There are no ethics in real estate!! Take what you can get. As long as they don't have any evidence, rip them off for everything they have. Life is hard for everyone. Bite down.

SHOULD SHMOULD! Should means nothing. It's all up to the lawyers now. If I were the buyer I would try to get my $5,000 back. Hey if a lawyer can make them give it back for $2,500, why not? On the other hand it is ONLY $5,000 and sometimes it is better to just learn from it and move on. Who really wants to spend time in court and have all the stress? As the buyer I might offer to admit my stupidity and offer to split the cash with them and move on. Otherwise threaten to sue. $2,500 back in the hand and no lawyer is better than doing battle any day.

If it was known then it should have been disclosed about the conditions of non demolition.He should ask an atty if he should get out and pay and then sue or just get out and have them sue him.

I am biased, I admit that up front:If all of this is truly accurate...and you remember that old game where someone whispers a secret and then it comes out all funny on the other end of the trail? Well anyone can sue anyone for anything and the proof is in the knowing. Where is the proof that anyone knew all of this? Is there someone who has something in writing or who is willing to go to court to say that the Realtor and the lender were lying? Is it someone who has a reputation of telling the truth? A REALTOR has to live to a Nationally stated Code of Ethics and protecting the public is something the state real estate commission takes seriously in every state. Many of the state real estate laws are written around the REALTOR Code of ethics. Yes there are people who have problems with telling the truth but, they don't usually get very far or last very long in the business. I hope you haven't run into one of them.___________To answer the questions: If they knew then they are bound to tell, (honesty and fairness) so was the seller who knew it best! What about a rehab or does that fall under demolition? I know in some cities if you keep one original wall or the foundation and rebuild 99% of the house it is considered a rehab. It surely sounds like someone needs an attorney! in this case!

Of course they should have disclosed. That is illegal, but the tough part is actually proving that they had the information and didn't disclose it. If the seller did not put it down on his disclosure form, than they could technically say they didn't know the local government laws/codes. It is the responsibility of the buyer, as it states in most contracts written up for realtors to use, to do due diligence. Always check within a 2 miles radius of your potential home and see what they're building, what's for sale. If I was going to buy lakefront property I would think there would be automatic questions, i.e., what can I build there, is it dockable, etc.. A quick call to planning would have taken care of their problem.Buyer Beware!