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Joined: 6/4/2003
Posts: 249
Posted on Friday, July 18, 2003 10:37:00 PM
DID YOU KNOW? - Grow Houses pose a serious threat to both home buyers and their agents!

Grow Houses have become prevalent in the Greater Toronto Area, resulting in various issues that both home buyers and their agents need to be aware of to protect themselves. A grow house is a dwelling (usually residential) that has been leased or bought by persons in the drug trade and turned into an indoor nursery for the growing of marijuana.

Aside from the obvious criminal activity that takes place at these dwellings, the operation of a grow house can result in current and future health and safety problems. These operations often involve significant alteration to the dwelling structure and electrical system, which can compromise the structural integrity of the building and pose safety and fire hazards. Furthermore, the large amount of moisture required to grow the plants indoors can result in mould growth, which can be hazardous to health.

As well as the health and safety hazards, problems often arise with regard to hydro connections. Due to the large amounts of power required to grow the plants, grow house operators often "steal" electricity through illegal connections to avoid detection. Some hydro suppliers have refused to supply power to a dwelling until "stolen" hydro has been paid for, potentially leaving unsuspecting landlords with large bills.

In addition, grow houses can raise liability concerns for realtors in a number of circumstances, whether it be in the sale or purchase of a former grow house, or unsuspectingly leasing a property to a grow house operator. If it is known that a property was used as a grow house, disclosure to potential purchasers is imperative. With regard to rental agreements, questions may arise over what the realtor did in qualifying the tenant if the owner of the property has relied on the realtor to screen potential tenants.

It is incumbent upon realtors representing sellers or landlords of properties suspected of being, or having been used as grow houses to take certain precautionary steps. They must (at a minimum) ensure that every effort is made to see that all parties to any potential transaction of purchase and sale or lease are dutifully notified of the potential issues. The aforementioned requirement for disclosure should be discussed with the seller and agreed to prior to marketing a listing.

When acting as a buyer broker, representing a buyer or renter, there are additional liability issues for the Realtor. It is incumbent upon them, because of their fiduciary relationship with their client, to exercise due diligence in obtaining proper information for the client, without interfering with the seller. The Toronto Real Estate Board has provided its members with special clauses, to be inserted into offers to purchase or lease, which deal with issues such as proper disclosure and warranties.

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