Individuals who want to sell a residential property in New York must ensure that they understand their responsibilities. For example, they must disclose specific information before a sale is completed. This enables a buyer to understand the actual condition of a property and its history.
Nowadays, in New York, seller are required to complete the Property Condition Disclosure Statement (PCDS). This includes all the required disclosures that must be made during the sale of a residential property.
Changes to the Property Condition Disclosure Act (PCDA)
In the past, sellers had the ability to provide the buyer of a home with a credit of $500 if they didn’t want to fill out the PCDS form. That’s no longer an option, so sellers must be prepared to truthfully fill out the PCDS.
Another change that A.1967/S.5400, which was signed by the governor on Sept. 22, 2023, made was adding new questions about flood hazard areas. These are based on the 100-year and 500-year floodplains. These seven new questions bring the total number of questions on the PCDS document to 56.
Omissions and misstatements have consequences
Accuracy is critical when completing the PCDS because any misstatements or oversights could lead the seller of a property to become the subject a lawsuit filed by a buyer. The updated PCDA allows for a claim based on actual damages for omissions and misstatements.
One point that has some individuals concerned is that there’s no penalty for the sellers if they don’t provide an accurate PCDS to buyers unless the buyer uncovers a defect that should have been disclosed. This underscores the importance for buyers to never rely solely on a seller’s statements and to always opt for a comprehensive property inspection prior to completing a purchase.
Some questions that remain about how this update to the PCDA will be handled in a variety of situations remain unanswered. Thankfully, anyone embarking on a residential real estate transaction can work with a legal representative who can assist them with ensuring that they’re acting within the bounds of the law as it is currently being interpreted.
