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If you plan on putting your home up for sale, there are laws in Arizona that detail what must be disclosed to any buyer.  Most sellers will have some questions about how much they are required to include and what information they must find if they don’t already have it.  There are some standard forms that will help make the process of disclosure easier for a seller.  The requirements will differ depending on whether it is commercial property, residential property or undeveloped land.

The Arizona Association of Realtors has a standard form that helps a seller figure out and organize all the details that will need to be included.  The Residential Seller’s Property Disclosure Statement (SPDS) is a standard part of any real estate transaction.  If you are working with a Realtor in Arizona to sell your home, the SPDS is typically one of the first documents they will present to you so that you can prepare all the information required to sell your home.

Anyone selling a home in Arizona is required to disclose any known material facts and any defects or issues that should be known about their property.  The disclosure statement has six sections that will need to be filled out:

Ownership and Property – This section includes questions about the general details of the property, like the property’s address, current status as owner-occupied or rental, age of the property, any potentially applicable association fees, existing assessments, liens, easements, and more.

  1. Building and Safety Information – This section includes questions about the roof and structure, any repairs completed or required, any wood infestations, plumbing issues or repair.
  2. Utilities – This section includes the details of the property’s electricity provider, fuel, water services, trash collection, cable/internet, fire services, and postal delivery information.
  3. Environmental Information – The seller must disclose any environmental issues or known issues with drainage, soil, fissures and dampness/moisture. The seller must also include any known issues with noise from highways or airports, traffic, landfills and toxic waste disposal near the property.
  4. Sewer/Waste Water Treatment – This section includes questions about the property’s sewer system or waste water treatment system. If there have been any repairs performed on the sewer system, you must disclose this information as well as information pertaining to the last inspection done on the system.
  5. Other Conditions and Factors – This section is the final catch-all category that requires the seller to disclose any other material facts not covered by other sections of the SPDS that might nonetheless impact the value of the property.

There are some other general things that will need to be disclosed by the seller in Arizona.  If your home was built before 1978, you will need to disclose that fact and any known issues related to the use of lead-based paint in the home.  You are required to disclose any lead paint inspections or reports on the home in your possession.  In the state of Arizona, home purchase contracts with Realtors will also include a Comprehensive Loss Underwriting Exchange report (CLUE).  This report must include the last 5 years of insurance claims, or otherwise as long as the seller has owned the home.

Items That Do Not Have to Be Disclosed

Arizona law does stipulate some specific information a seller does not have to disclose to buyers.  Frequently referred to as “stigma statutes,” one of the most common under Arizona’s stigmatized property law is that you do not have to disclose if a death has occurred in the home. This is true regardless of whether the death was natural, suicide or a homicide.  A seller does not have to disclose if anyone that resided in the home has or has been exposed to HIV or other diseases that are not contracted through common occupancy.  A seller is not required to disclose whether sex offenders live in the area as well.  While not strictly protected information, as any buyer may find that information on their own, it is nonetheless not the seller’s responsibility to disclose such information.

When in Doubt, Disclose!

Sellers will frequently ask if they must disclose certain information that may or may not appear to be relevant or pertain to the value of the property.  Unless it falls into the three specific situations detailed by Arizona law, the answer is probably yes.  If you have factual information about your home that could potentially be material to a person in the buyer’s position, you are encouraged to disclose them.  You are not required to immediately make a concession on the purchase price, even if the buyer is requesting it.  It is important to note that you may be putting yourself in legal jeopardy if you choose not to disclose potentially material facts during a real estate transaction.

The attorneys at MacQueen & Gottlieb have significant experience with real estate law in Arizona.  Our attorneys can assist you with any disclosure issues and help you understand what will be required if you are considering selling your home.  If you were involved in a real estate transaction where one party withheld material facts, our attorneys can assist you in pursuing that case.  Contact us today at (602) 533-2840 to schedule an initial consultation or make an appointment online.
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