Legal Question in Real Estate Law in Maryland

Re: bought house as-is but owner knew of severe electrical & water problems

If the owner knew of and deliberately concealed a defect that you could not reasonably have been expected to discover in an inspection of the property, he can be held liable for the cost of repair. It is often difficult to prove that the former owner was aware of the defect, even if you can determine that it must have existed prior to the transfer of title. In a basement flooding situation, there will be an issue of whether there were sufficient indicia of that condition (damp odors, water stains, etc) that would have brought the problem to your attention on inspection. However, if he specifically denied that such a condition existed during the sales process (as opposed to simply not affirmatively revealing it), you would have a stronger case.

As for the agent, it's a more difficult case because the agent is obviously less familiar with the property than the owner, and can't be held responsible for the owner's fraudulent conduct if he/she was unaware of it.