Humber/Ontario Real Estate Course 4 Exam Practice

Which statement best describes material facts in real estate transactions?

1. They are general factors common to all sellers.

2. They are personal factors unique to each seller.

3. They are limited to items the seller chooses to disclose.

4. They do not require supporting evidence or documentation.

5. They are facts the buyer must independently verify.

6. They must be disclosed only if asked by the buyer.

The correct answer is: They are personal factors unique to each seller.

Material facts in real estate transactions refer to details that influence a buyer's decision and typically relate to the property itself. The statement that they are personal factors unique to each seller captures this essence, as these facts may include aspects of the property or circumstances surrounding its sale that could significantly affect its value or desirability. For example, this could involve unique information about the property's condition, legal issues, zoning restrictions, or previous renovations that the seller has undergone. Such personal factors are crucial because they provide the buyer with a complete picture of what they are purchasing. The other options do not accurately reflect the nature of material facts. General factors common to all sellers would not necessarily apply to a specific transaction. Limiting material facts to only what the seller chooses to disclose fails to acknowledge the obligation to disclose certain conditions inherently linked to the property. Furthermore, material facts necessitate supporting evidence or documentation rather than being unfounded claims. Buyers have the responsibility to verify information themselves, but material facts should be transparently shared by sellers to aid this process. Lastly, the expectation that a seller must disclose material facts only if asked undermines the proactive duty to disclose relevant information in real estate transactions.