Humber/Ontario Real Estate Course 4 Exam Practice

Which of the following is considered a "material fact" in a real estate transaction?

1. The client's favorite color.

2. The number of homes sold in the neighborhood.

3. The presence of an underground oil tank.

4. The property's garden layout.

5. Upcoming local events.

6. Weather patterns in the area.

The correct answer is: The presence of an underground oil tank.

In a real estate transaction, a "material fact" is defined as any information that could affect a buyer's decision in a significant way. This can include anything impacting the property's value, safety, or habitability. The presence of an underground oil tank qualifies as a material fact because it poses potential environmental risks, regulatory implications, and possible costs associated with removal or remediation. Buyers need to be informed about such issues to make educated decisions regarding the purchase of the property. In contrast, personal preferences like a client's favorite color or factors such as the layout of a garden do not impact the physical condition or value of the property and therefore do not qualify as material facts. Similarly, statistical data about homes sold in the neighborhood may provide context but does not directly affect the specific transaction in question. Upcoming local events and weather patterns might influence lifestyle choices but do not have the same direct impact on the property's fundamental value or safety.