Sellers of California real estate have duties under the law to provide full disclosure about the condition of the property, the natural hazards associated with its land and location, the environmental hazards and neighborhood influences on the value or desirability of the property.  In addition, sellers must reasonably accommodate buyers in their rights to inspect the property, having all utilities operating. 

Sellers liabilities to their buyers continue if they fail to make disclosures of known property defects; thus it is imperative that they provide full disclosure.  In addition to information directly from the seller, many other disclosures are made by third parties.  These are paid for by either the seller or buyer and include the natural hazards report, often a pest control inspection report, and specific city reports and inspection requirements.

California law requires sellers of 1 to 4 units of real estate to make full disclosure to buyers of all known defects and hazards associated with the property being sold.  In addition to the disclosures required of sellers, real estate licensees who are involved in the transaction are duty-bound to make a careful visual inspection of the property and report to the buyers any problems noted.  Among the required disclosures are those listed below.
Real Estate Transfer Disclosure Statement

The real estate transfer disclosure statement, known as a TDS, requires full disclosure of the condition of the property as known to the Seller and/or observed by the agent(s).  This disclosure has a built-in 3-day right of rescission if provided after the acceptance of an offer (or 5 days from the date mailed).  When provided to the buyers prior to final acceptance of an offer, there is no such right of rescission.  Other agreed contingencies are not affected.  

Legal experts recommend that sellers provide their buyers with all information known about properties and anything that could possibly affect the buyers' decision on whether or not to make the purchase, and at what price.  If information is withheld, the sellers' retain liability beyond the close of escrow. 

Statewide Buyer and Seller Advisory
A 10-page form, the Statewide Buyer and Seller Advisory is a comprehensive disclosure of a multitude of items that were handled by separate documents in the past.  The form alerts the parties to their opportunities for inspections and to their obligations.   It is unlikely that every facet of the items discussed would be applicable to a single transaction, but the form provides a useful analysis of what could be included in the due-diligence investigation of a property purchase.

Natural Hazards Disclosure Statement

The Natural Hazards Disclosure Statement is a mandated disclosure that sellers must provide to buyers.  Most sellers obtain this report for a fee from an licensed independent agency.  When provided to the Buyer after the purchase agreement is signed, there is a 3-day right of rescission from buyer's receipt (5 days if mailed).  This report basically summarizes information obtained in the "Zone Disclosure Reports."

Zone Disclosure Reports

Usually purchased from independent source, these reports are based on information and maps published by government and quasi-governmental agencies that identify natural hazards such as known & mapped earthquake faults. Also see Natural Hazards Disclosure Statement.

Seller Property Questionnaire
Although the Seller Property Questionnaire is not required by State law, it is often used as a supplement to the Seller's Transfer Disclosure Statement.  It identifies specific items that might be important areas for disclosure.

Lead-Based Paint Disclosure
Sellers are required under California law to provide buyers with a special booklet describing the problem related to lead in the home.  The seller must also notify the buyer of any known presence of lead-based paint in the home and allow for inspections to find such presence if the buyer desires it within an agreed time period or 10 days.

Smoke Detector Disclosure 

Smoke detectors must be installed in every home built or sold after January 1, 1986 to meet the requirements of State law.  Sellers must complete a form for the buyer that verifies compliance and proper installation of the required smoke detectors. 


Water Heater Statement of Compliance

Heavy double bands are required under State law to secure residential water heaters in case of earthquake.  Sellers are required to provide buyers with a statement of compliance.

Special Retrofit Requirements

Each municipality has the authority to enact requirements that are additional to those imposed by the State.  It is therefore necessary to verify current requirements by calling the City Building & Safety Department. The City of Los Angeles, for instance, has more stringent requirements than many nearby communities.  Confirmation that the modifications have been completed is required by the city.  Many sellers hire a company to make the required confirmations.  


Residential Earthquake Hazards Report

Sellers are required to fill out a form known as the Residential Earthquake Hazards Report and deliver it to the buyer along with a copy of the Environmental Hazards and Earthquake Safety report that includes information on gas shut-off valves, lead, and toxic mold.  The report asks the seller for information on how the home was built and what is known about earthquake faults and seismic hazard zones.

Energy Efficiency Booklet (when published)

Mello-Roos Disclosure Notice

If property is located in a Mello-Roos area, property sellers are obligated to make suitable disclosures to buyers.

Mello-Roos is a type of lien placed on property to pay for public improvements in some newer developments.  It is paid over typically 30 years and is added to the County property tax bill and collected by the Tax Collector. It is not found in many established areas.  The property developer or the County Assessor's Office should be contacted for specific information.

 Sellers' Responses
Donna States
Donna States
Broker Associate
No Address Provided Torrance CA 90505