Whether you are buying property to expand your business or want to sell property in your portfolio to move on to new ventures, you must keep track of many different legal details. One important aspect of the sale is disclosing required information.
What disclosures does California law require?
Under California law, people selling commercial, industrial or vacant property must disclose certain information about the real estate they wish to sell. These details about the property’s condition, location and history could impact its value or desirability, and buyers must have this information in order to make an informed decision about the sale. Required disclosures for real estate sales include:
- Whether a person has died on the property in the past three years
- Flooding, fire or earthquake risks for the area, including flooding disaster insurance requirements
- Nearby airports
- Whether title insurance is advised for the property
- The condition of the property and its structures, including known damage
- Whether hazardous materials have been released on site
Sellers who knowingly fail to disclose these details about their property open themselves up to potential lawsuits. If a lawsuit is successful, sellers may need to pay repair costs, damages for the decrease in property value that the defect caused and punitive damages. The court could also declare the contract invalid.
Buyers and sellers navigating disclosure requirements should speak to an attorney with experience in business law and real estate. They can help ensure that you have the information you need during the sale of commercial property and protect you from future liability.