What is a latent defect in real estate?

A latent defect in real estate refers specifically to a hidden structural defect that cannot be identified through a cursory or ordinary inspection. This type of defect may exist within the property and could potentially affect its value or safety, but it is not readily visible to a buyer or inspector without a more thorough investigation.

Being "hidden" is crucial to understanding latent defects, as they might not be disclosed during a typical showing or inspection. Examples often include issues such as faulty wiring, plumbing problems hidden behind walls, or issues with the foundation that become apparent only under specific conditions.

Understanding this concept is important for both buyers and sellers, as it can influence negotiations and liability for property condition after a sale. Sellers are oftentimes required to disclose known latent defects, and buyers may need to perform due diligence to uncover any hidden issues before finalizing a property transaction.