Property Condition
Disclosure Is Now Required

Instead of caveat emptor (let the buyer beware),
the law now requires home sellers to make the buyer “aware”

Mandatory Seller's Property Condition Disclosure becomes law March 1, 2002.

Beginning on March 1, 2002 every seller of one to four family residential housing in the State of New York – whether they be broker assisted or for sale by owner - will be required to provide a completed property condition disclosure statement to potential buyers under the Seller’s Property Condition Disclosure Law. Similar disclosure programs are in effect in more than 30 other states and have proven to be beneficial to sellers, buyers and agents.

The benefits include:

• Fewer disputes, easier transactions and less litigation for agents and sellers.
• More information at the time they need it most for buyers.

A completed form must be provided to the buyer before the buyer is bound by a contract of sale. While the seller must complete the disclosure form without assistance from a real estate agent, agents do have certain duties.

Under the new law:

• Listing agents must educate their seller clients about the law.
• Buyer agents must educate their buyer clients about the law.
• Listing agents and sub-agents must educate customers about the law.

The new law does NOT apply to new construction, condos and co-ops.

NOTE:
Other key provisions include a requirement that a copy of the completed form be attached to the contract OR a $500 credit be given to the buyer at closing for the seller's failure to provide the completed form.

Education Of Clients/Customers

Under the law, residential real estate agents are required to "educate" their sellers-buyers-clients-customers about their obligations and/or rights with regard to property disclosure.

This required “education” from real estate agents consists of the presentation of a statement of a few paragraphs which explains the “seller-buyer-client-customer’s” rights (and/or obligations) under the law. The “seller-buyer-client-customer” is then required to sign the bottom of the form acknowledging that he or she has been informed or “educated” (a similar procedure is already in place for Lead Disclosure - a booklet is provided & an acknowledgement is signed).