Sudbury, Ont., buyers say housing market pressure made them leap into bad purchase

A couple that bought a house in Sudbury, Ont., sight-unseen with no conditions says they got swept up in a hot housing market and now have major regrets. They're sharing their story as a cautionary tale to other would-be buyers on the importance of due diligence.

Josh Keyes and Yuri Nakashima were excited to be able buy their first home in Sudbury after being priced out of the market in Vancouver. But when they walked into their newly-purchased house earlier this month, they discovered it was far from a dream home.

"Once we opened the door, immediately we started realizing the terrible condition that this place is in," Keyes said.

Keyes said he and his wife are now facing tens of thousands of dollars in repairs on a property for which they already paid about $60,000 over the asking price.

Pressure of a hot market

Keyes and Nakashima had been living in Vancouver for six years, and said buying a home there was out of the question due to high prices, so they started looking elsewhere. Keyes, who is originally from Kapuskasing, Ont., also wanted to be closer to family, so the couple settled on Sudbury.

Located in northern Ontario, Sudbury has seen its housing prices rise quickly, driven partially by buyers from larger markets attracted to its comparative affordability.

Not wanting to travel across the country to look at homes, the couple worked with a real estate agent at a distance, relying on listing photos to inform their decisions. Keyes said they were advised by their agent that an offer with conditions was unlikely to be accepted, so they waved a home inspection.

"We felt a lot of pressure because all of the news just kept on saying that housing prices are going up and up, and we don't know if there will be a turnaround. It might just continue going up and then we'll be priced out of the housing market forever," Keyes said.

"We felt like this would be our last chance to get a house."

Floor 'caving in' 

Keyes and Nakashima bought a house in Sudbury's west end, which Keyes said looked "great" in the listing photos.

He said the sellers did not disclose any issues with the house. But when they entered the home for the first time after getting possession in February, they discovered cockroaches, a sewer line that needs to be replaced, gaps under baseboards, and a rotting support beam under the house.

"The floor is caving in, it's sinking," Keyes said.

Keyes and Nakashima said they don't feel they were advised on proper due diligence, and don't feel their real estate agent acted in their best interest.

"Of course a lot of it is our responsibility. But as first time home buyers and us relying on the real estate agent to really guide us through the process, I think she is also responsible, and the seller as well," Keyes said.

CBC contacted the real estate agent the couple worked with, but did not hear back.

Duties of a real estate agent 

Julie Robert, the broker-owner at Century 21 Integrity in Sudbury said offers without conditions have been typical over the last year and a half, though in recent weeks some offers have been accepted with conditions.

As for clients buying a house sight-unseen, she said it's something she's been seeing more frequently. In those cases, she advises clients of the benefit of a pre-inspection, prior to submitting an offer. While less thorough than a full home inspection, "at least it gives the client an idea on if there could potentially be any issues with the property," Robert said.

At the end of the day, she said, acting in the best interest of clients means providing them with information.

"Every client's risk tolerance is going to be different. … I think it's just important to explain to the clients what their options are to begin with," Robert said.

If someone buys a house with no conditions, Robert said there may be some options for recourse, though those themselves could be costly.

"I think if you can prove that the sellers hid something, you can definitely go back to your lawyer and I guess sue them. But at the end of the day you're still trying to prove that the sellers knew about the issue beforehand and just didn't disclose it," Robert said.

Keyes and Nakashima said they are considering their options, and are planning to speak with a lawyer, and possibly file a complaint with the Real Estate Council of Ontario.