Required Disclosures When Selling a Property

Before transferring or selling a property, the transferor or seller must disclose various things under the law. The broad over-arching theme is that sellers must disclose anything that effects the market value of the property. However, that theme can be quite subjective because what one seller thinks of as affecting market value, another seller may not have even considered. In an effort to fill in these subjective gaps, California legislature has passed various statutory requirements.

Please note: this list is not exhaustive.

(1) Statutory Real Estate Transfer Disclosure Statement

When selling a single-family residence (i.e. any real property improved with or consisting of not less than one nor more than four dwelling units) the seller must complete and deliver a statutory disclosure form to the transferee (buyer) unless a statutory exception applies. Any waiver of this requirement is void. The failure to provide such a disclosure allows the buyer to rescind (cancel) the contract.

(2) Local Option Disclosure Statement

If a transferor is required to complete the statutory real estate transfer disclosure statement, the city or county in which the property is located may require the transferor to provide additional disclosures regarding the property.

(3) Natural Hazard Disclosures

Sellers or their agents must notify prospective buyers or tenants when the real property lies within any of the following hazardous areas:

- A special flood hazard area

- An area of potential flooding shown on an inundation map prepared pursuant to Water Code 6161

- A very high fire hazard severity zone

- An earthquake fault zone

- A seismic hazard zone

- A wildland area that may contain substantial forest fire risks and hazards

(4) Earthquake Safety Guides

A seller of a residential dwelling of conventional light-frame construction built before 1960 and containing one-to-four living units must, as soon as practicable before the transfer of title, deliver to the buyer (1) a copy of the Homeowner’s Guide to Earthquake Safety as published by the California Seismic Safety Commission, and (2) an earthquake hazards disclosure statement regarding the property.

A seller of commercial property must comply with substantially the same requirements, except that the Commercial Property Owner’s Guide to Earthquake Safety includes explanations of what constitutes “adequate wall anchorage.”

(5) Smoke Alarms

Every single-family dwelling and factory-built housing unit [see Health & Safety Code   19971] that is sold must have an operable smoke alarm.

(6) Water Heater Bracing

All existing residential water heaters must be braced, anchored, or strapped to resist falling or horizontal displacement due to earthquake motion..

(7) Lead-Based Paint

The seller must disclose to the buyer the presence of any known lead-based paint and lead-based paint hazards, provide available records and reports, and give the buyer a lead-hazard information pamphlet.

(8) Notice of Nearby Ordinance Locations

For these purposes, “former federal or state ordnance locations” means an area identified by an agency or instrumentality of the federal or state government as an area once used for military training purposes that may contain potentially explosive munitions.

(9) Common-Interest Development Information

The owner must furnish prospective buyers with specified documents relating to the common-interest development and the owner’s separate interest.

(10) Title Insurance

When a policy of title insurance is not to be issued to the buyer, the buyer must be given a statutory notice indicating that it may be advisable for the buyer to obtain such a policy.

(11) Disclosure of Industrial Zoning

Seller of residential real property who has actual knowledge that the property is adjacent to, or zoned to allow, an industrial use or affected by a nuisance created by such a use, must give written notice.

(12) Local Health Officers Order Prohibiting Use

After receipt of an order by a local health officer prohibiting the use or occupancy of particular property, the property owner must promptly engage a contractor to clean up the property. Until the order is cured, the seller they must notify a prospective buyer in writing of the order and provide them with a copy of the pending order.

(13) Property Tax Disclosures

The seller of any real property subject to the disclosure requirements of Civ. Code 1102 et seq. must make disclosures if the property being sold is subject to a continuing lien securing the levy of special taxes pursuant to the Mello-Roos Community Facilities Act.

(14) Private Transfer-Fee Requirement

The use of transfer fees is strictly prohibited.

(15) Noncompliant Plumbing

Seller must disclose in writing that California single-family residences must be equipped with water-conserving plumbing fixtures on or after January 1, 2017.

(16) Gas and Hazardous Liquid Transmission Pipes

Every contract for sale of single-family residential real property, entered into on and after July 1, 2013, must contain a specified notice regarding gas and hazardous liquid transmission pipelines.

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If you are considering selling your property and are unsure where to start or what disclosures are required, you can contact our office at 1-800-233-8521 for a FREE phone consultation. Or you can contact us using this form.