In real estate, one phrase you’ll run into is caveat emptor. Buying or selling a home can be confusing enough on its own, before bringing in a different language. Here we’ll break down what caveat emptor means for you.
Caveat emptor is a Latin phrase that translates to “let the buyer beware” in English. In real estate, it’s similar to the idea of buying a house that’s sold as-is. Caveat emptor means the buyer gets what they get, even if it has major flaws. If unknown problems turn up after the sale, the seller is not responsible for them, leaving the buyer on the hook.
It takes the liability off the seller, letting the buyer know they’re purchasing the property at their own discretion. However, in most states, sellers are required to disclose all known problems with the property. Where caveat emptor was once the standard nationally, that trend has been shifting over the past several decades. Although recently, we have seen more and more homes being sold "as-is" due to the pandemic and market conditions. It is heavily considered a "seller's market" right now and buyers have less power than before in terms of negotiating.
The opposite of caveat emptor is caveat venditor, or “let the seller beware.” In the United States, caveat venditor has become much more prevalent than caveat emptor. The trend in court in some states is focusing on buyer protection, so the seller may need to take extra steps to protect themselves. If you’re the seller, protecting yourself starts with disclosing everything you’ve done with the property or any property concerns. This includes repairs done, property defects or potential property disputes. Error on the side of over-disclosing, as you would rather reveal too much than get in legal trouble down the line.
Make sure to discuss with your agent anything of concern that you see on property disclosures, these are legally binding and can allow for recourse should something come up in the future.