What should you declare when selling your home?

Don't be tempted to lie on the Property Information Form – because it could come back to bite you.

We all want to get the maximum amount of money possible for our home, and it doesn't take a genius to do the right things with your property to attract buyers. Declutter, give it a fresh lick of paint in a neutral colour, tidy up the garden, put some elbow grease into cleaning it.%VIRTUAL-SkimlinksPromo%
But what if your home harbours a darker secret that you know will put buyers off?

Perhaps you have a long-running feud with a neighbour, or large cracks appearing quicker than you can fill them in? It could be very tempting to stay quiet about these problems, sell the house and move on with your life.

But you run the risk of being sued in the future. When it comes to selling your home, honesty is the best policy.
Isn't it 'buyer beware'?
Many people will tell you that it's caveat emptor (or 'buyer beware') when it comes to residential property purchase, and while that is true, it only goes so far.

For example, you must tell your buyer about any latent defects in the title to your property, if there is no way they could reasonably find them out before exchanging contracts with you. An unregistered easement, such as a right of way that isn't on the title deeds, is one such example.

Your solicitor will be able to help you work out if there is anything you legally need to disclose to your buyer.

In addition, to give buyers some protection, the usual conveyancing process requires the seller to fill in what is called the Property Information Form (or TA6 to give it its technical name) which gives your buyer a whole load of information about your property that they would otherwise be unable to find out through surveys or the standard searches.

This form has just been updated and extended, so sellers are required to disclose even more information on their homes, including:
  • Information on boundaries – such as those between you and your neighbours
  • Details of any disputes with neighbours (not just those adjacent)
  • Notices of development or planning permission of properties nearby (not just your neighbours)
  • Alterations and building work ever done on the property (including details of planning permissions and building control completion certificates – of lack of!)
  • Buildings insurance details.
This form is really important and must be filled in by all sellers, so you can't use the excuse that you never saw it. You are responsible for it if your name is on the title deeds of the property. It also forms part of the pre-contract documents so it's legally binding and the buyer can sue you if you lie on it, or deliberately conceal something.

This form will reveal a great deal about your property, including some things you might prefer to keep quiet.

So is there any way around not disclosing something that the TA6 form covers?

Don't complete the full form?
It isn't strictly compulsory to fill in this form but most conveyancing solicitors will insist that you do. Indeed, if yours holds the Conveyancing Quality Scheme accreditation (hopefully they do) they will work to a strict protocol that includes their sellers completing this form.

If your solicitor doesn't insist you complete TA6 you can, in theory, decide not to.

But beware; this will raise a huge red flag with the buyer's solicitor. This document is such a standard part of modern conveyancing that they will ask for the answers to the missed questions, and if they still aren't forthcoming it will be pretty obvious you are trying to hide something.

This will be explained to the buyer, who could well pull out of the purchase.

Lie on the form?
Alternatively you may be tempted to tell the odd white lie, or big lie, on the form. For example you might say you've never had any run-in with the neighbours, when in fact you have an ongoing boundary dispute or a long-running row about noise.

Your lie is unlikely to come to light before exchange of contracts, so you might think you are home and dry. But if the lie is revealed afterwards, perhaps unwittingly by another neighbour, your buyer could come after you.

And if the neighbours are a real problem, they probably will seek redress. Wouldn't you?
If you have had a minor dispute with a neighbour and you aren't sure whether or not you should declare it on the form, particularly if it's over, err on the side of caution and discuss the matter with your solicitor. But as a rule of thumb anything that was put in writing to a neighbour, or phonecalls made to the council or the police, needs to be mentioned.

Be vague with your answers?
Some sellers might try to be vague with their answers, so as not to give anyway any nasties about their home, without incriminating themselves.

For example, perhaps you know your home has been previously underpinned before you bought it (which comes under building works), and you want to give a loose answer to this question – such as saying "we have done no building works since owning the property".

Be very wary about this if you know that significant building works have been done prior to your ownership. They should be mentioned, and half-truths can be considered a misrepresentation. The form has been designed and updated to try to avoid vague replies and many questions require a straight yes or no answer.

If you genuinely don't know the answer to a question you can state this but don't use it as a blanket answer to avoid something. If the buyer can prove you did know about something that you didn't admit to, you can be sued for misrepresentation.

And remember, if the work was declared to you when you bought the property, there is probably a paper trail that can prove you have lied.

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What should you declare when selling your home?

Of course with all these things, the value it adds depends on the property you have to start with, and the kinds of improvements you make, but Which? estimates the cost of a new kitchen at £8,000 and HSBC calculates the added value to your property at £4,500 - which is a clear loss.

This has been done by 41% of people in the last three years, and 29% of people plan it in the next three. It's cheaper than a kitchen, and Which? estimates the cost at £3,000. This is roughly the same value that HSBC says it will add to your property - so you'll break-even.

It may be difficult, but getting your property ready for sale means depersonalising it. 

Clutter can distract viewers and more than half (60%) of the property valuers who took part in the 2012 HSBC Home Improvement Survey said that the number one way to increase a property's chance of selling quickly, and for a good price, was to de-clutter.

This has been installed by 31% of us in the last three years, and 15% plan it in the next three. Installing central heating is a disruptive job, and according to WhatPrice it will cost you around £3,235. However, this is the first of the top ten to actually pay off. Property expert Phil Spencer says it will add £5,000 to the value.

A quick splash of paint can work wonders on tired-looking walls, and sticking to neutral tones is the safest bet.

Keeping the colour scheme simple, fresh and inviting will help potential buyers to see themselves living in your home.

Some 18% have added one in the last three years, and 30% will in the next three. This is another huge job, but with more people struggling to move and deciding to improve instead, it's increasingly popular. The amount it costs will depend on an enormous number of things, from the area you have to work with, to the size of the extension. However, assuming you add a single room you could spend around £20,000. HSBC estimates it will add around £15,500 to the value of the property, so you are unlikely to gain as much as you spend.

According to Halifax valuers, loft conversions - which require lofts with a roof height of at least 2.4 metres - are a good way to increase the potential sale price of your home.

Be sure to stick to your budget, though. The average loft conversion will cost between £10,000 and £30,000, while HSBC's figures show that they typically add £20,876 to the value of a property.

Putting in new windows adds around £5,265 to the value of the average property and can reap big rewards when it comes to energy efficiency.

It is, however, sensible to ensure that your new windows are in line with the style of your property to maximise the added value - particularly as putting them in can set you back about £5,000.

Off road parking or a garage can be especially advantageous in areas where parked cars line both sides on the street.

Nationwide's figures show that adding a garage, which can cost anything between £8,000 and £25,000, can increase the value of your property by 11%.

Outside space is just as important as inside - especially when people are seeing your home for the first time.

While 63% of the HSBC survey expert respondents said that repainting or varnishing a front door would make a difference, only 23% of homeowners recognised this. Peter Dockar at HSBC said: "It is often the smaller jobs like painting the front door that can make all the difference when looking for a sale."

What if you are sued?
Under the law (specifically the Misrepresentation Act 1967) the burden of proof of misrepresentation has shifted from buyer to seller. This means it isn't up to the buyer to prove you knowingly lied on the form, it's up to you to prove you didn't if they make a claim against you.

If a court finds you guilty of misrepresentation – which might be fraudulent, negligent or even innocent – it can order you to pay damages to your buyer, which can run into tens of thousands of pounds depending on the nature of the problem.

If the misrepresentation is serious enough it can also order rescission of the contract, meaning you would need to buy back your old property and cover any expenses of the buyer, including mortgage interest and legal costs – which could total a small fortune.

Finally remember that misrepresentation isn't confined to the Property Information Form. You can misrepresent your home by deliberating concealing major, progressive cracks that you know (or suspect) to be caused by subsidence, for example, or by lying to a viewer of your property, directly or through your estate agent.

No one wants to have to take a hit on the value of their property, but equally nobody wants to buy a home with a massive problem that was deliberately concealed from them.

What would you do? Have you ever concealed a problem in order to sell your home? Or bought a dud?

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What should you declare when selling your home?

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