Whether you’re buying or selling property in Pennsylvania, understanding the state’s real estate disclosure requirements is important. These laws exist to ensure that buyers are made aware of known material defects in a property before completing a transaction. Sellers, in turn, have a legal duty to provide honest and accurate information. Failure to comply can lead to costly legal disputes, even after a sale has closed.
Pennsylvania’s disclosure requirements apply primarily to residential real estate transactions, but similar principles of good faith and full disclosure are also potentially consequential in commercial sales, particularly when representations are made during negotiations.
The real estate seller disclosure law
In residential transactions, Pennsylvania’s Real Estate Seller Disclosure Law (RESDL) requires sellers of properties with up to four dwelling units to complete and deliver a Property Disclosure Statement. This document should outline any known material defects in a home and its systems.
A “material defect” is defined as a problem with the property that would have a significant adverse impact on its value or that poses an unreasonable risk to people. Sellers must disclose issues they know about; they are not required to hire inspectors or uncover hidden problems, but they cannot intentionally conceal known defects.
The Property Disclosure Statement includes more than a dozen sections, covering various aspects of the home and its condition. Sellers must address:
- Water and sewage systems
- Roof condition and leaks
- Heating, cooling, and electrical systems
- Structural problems, including foundation and walls
- Pest infestations and history of damage
- Hazardous substances such as mold, radon or lead paint
- Legal issues like boundary disputes or zoning violations
- Past insurance claims or repairs related to property damage
It’s not enough to answer “no” or leave sections blank; if the seller doesn’t know, they must state so clearly. Omissions or misleading statements can expose the seller to lawsuits for misrepresentation or fraud.
Exceptions
There are several exceptions to the disclosure requirements. For example, the law does not apply to new construction that has never been occupied, transfers between family members or foreclosure sales. In commercial real estate, disclosure is governed more by contract and negotiation than by statute, but sellers are still expected to avoid fraudulent or intentionally misleading statements.
If a seller fails to disclose known defects, and the buyer later suffers damages as a result, the seller may be held liable. Remedies may include rescission of the sale, repair costs or legal damages. Buyers who believe they were misled should consult a real estate attorney promptly to assess their options. Sellers concerned about minimizing their risk of liability can benefit from legal guidance as well.
