Property Disclosure Laws: What Sellers Must Legally Disclose

9 October 2025

So, you're all set to put your house on the market and cash in on your real estate investment. But wait—before you start celebrating with a bottle of bubbly, let’s talk about something crucial: property disclosure laws. Yep, those pesky little legal requirements that could either save you from a lawsuit or land you in hot water faster than a faulty water heater.

Whether you're a seasoned seller or a first-timer, you must know what you're legally required to disclose. Because, trust me, the last thing you want is an angry buyer knocking on your door with a lawsuit in hand.

But don’t worry—I’ve got you covered. Let’s dive into everything you need to know about property disclosure laws and what you’re legally obligated to spill before handing over the keys.

What Are Property Disclosure Laws?

In simple terms, property disclosure laws require home sellers to inform potential buyers about any known defects or issues with the property. Think of it as full transparency—because hiding problems could come back to bite you big time.

These laws vary by state, but their purpose remains the same: to protect buyers from purchasing a money pit and to prevent sellers from pulling a fast one.

So, if your house has a cracked foundation, a leaky roof, or a ghost in the attic (okay, maybe not that last one), you must disclose it. Otherwise, you could be in for a nasty lawsuit later on.

Why Do Property Disclosure Laws Exist?

Well, let’s put it this way—imagine buying a car that looked spotless on the outside but had a failing transmission. You’d be furious, right? That’s exactly why property disclosure laws exist: to protect buyers from unwanted surprises and to ensure fair transactions in real estate.

Without these laws, sellers could hide major defects, leaving buyers stuck with expensive repairs. And unless you want to be known as that shady seller, it’s best to play by the rules.

The bottom line? Honesty is the best policy. And in this case, it’s also the legal policy.

What Must Sellers Disclose?

Let’s get down to the nitty-gritty. What exactly do you have to disclose when selling your property? Well, here’s a handy checklist of common disclosures that most states require.

1. Structural Issues

Cracks in the foundation? Sagging roof? Termites turning your walls into their personal buffet? Yep, all of that needs to be disclosed.

Structural problems can lead to costly repairs, so buyers have the right to know what they’re dealing with before making an offer.

2. Water Damage & Leaks

If your basement floods every time there's a heavy rain, you must mention it. Same goes for leaky pipes, hidden mold, and any past water damage—even if you "fixed" it. (Because let’s be honest, slapping paint over mold isn’t fixing anything.)

3. Electrical & Plumbing Issues

Outdated wiring? Faulty plumbing? These are major safety hazards, and failing to disclose them could land you in serious trouble later on.

4. Roof Problems

A damaged or aging roof is a big deal, and most buyers will ask about it upfront. If your roof is missing shingles or has a history of leaks, be honest about it.

5. Pest Infestations

Termites, mice, cockroaches—oh my! If your home has ever had a serious infestation, you need to disclose it. No one wants to move into their dream house only to find out it's already occupied by unwanted guests.

6. HVAC & Heating System Defects

If your furnace is on its last legs or your air conditioning unit only works when it feels like it, that’s something buyers need to know. After all, nobody wants to freeze in the winter or melt in the summer.

7. Environmental Hazards

Lead paint, asbestos, radon gas—if your home has had any of these hazardous materials, you must disclose it. These aren’t just minor inconveniences; they’re serious health risks.

8. History of Major Repairs or Renovations

If you’ve made significant repairs or renovations, disclose them. And no, "DIY fixes" don’t count—if it wasn’t done professionally, buyers have the right to know about it.

9. Death on the Property (Yes, Really!)

Believe it or not, some states require sellers to disclose if someone died in the home—especially if it was under unusual circumstances. (So, if your home is the setting of a haunted house movie, you might have to bring it up.)

10. Property Disputes & Zoning Issues

If there are boundary disputes or zoning restrictions, buyers need to know. Nobody wants to buy a home only to find out later that their backyard actually belongs to their neighbor.

What Happens If You Don’t Disclose Issues?

Think you can get away with sweeping things under the rug? Think again. Failing to disclose known issues can lead to serious consequences, including:

- Legal action: Buyers can sue you for misrepresentation or fraud.
- Financial penalties: You might have to cover the costs of repairs—or worse, refund the buyer completely.
- Damage to your reputation: A lawsuit or bad word-of-mouth can make it way harder to sell another property in the future.

Moral of the story? Honesty is always the best (and safest) approach.

Do Sellers Need a Property Disclosure Form?

In most states, yes! A property disclosure form is a formal document where sellers list all known defects. Some states require very detailed forms, while others only require minimal disclosures.

Even if your state doesn’t mandate a disclosure form, filling one out is a good idea. Why? Because it protects you from future disputes. Having everything in writing ensures there’s no miscommunication about what was disclosed.

Are There Any Exceptions to Disclosure Laws?

Glad you asked! Not all sellers have to disclose property defects. Here are some common exceptions:

- Bank-owned properties (foreclosures) – Since banks never lived in the home, they aren’t required to disclose issues.
- Estate sales – If you're selling a home on behalf of a deceased homeowner, you might not be required to disclose defects.
- "As-Is" Sales – In some cases, selling a home "as-is" reduces disclosure requirements. (But be warned—this won’t protect you from lawsuits if you intentionally hide problems.)

Always check your state’s disclosure laws to know what applies to you!

Final Thoughts: Honesty Pays Off

Selling a house isn’t just about staging and setting the right price. Full disclosure is a MUST. Being upfront about property issues not only keeps you out of legal trouble but also builds trust with potential buyers.

At the end of the day, a well-informed buyer is a happy buyer. And a happy buyer is far less likely to sue you down the road. So, before you list your home, make sure you know what you need to disclose—and get everything in writing.

Because let’s be real—selling a home is stressful enough without the added drama of a lawsuit.