In residential real estate disclosures, Arizona law requires that sellers disclose certain information to buyers when they sell. The Arizona Association of REALTORS® has developed a standardized form called the Residential Seller’s Property Disclosure Statement (SPDS) that guides sellers through the process of furnishing all the legally required information in a real estate transaction. Most REALTORS® provide this form to sellers to fill out when they are preparing to sell residential property that they own. However, although the standard form, the AAR Residential Resale Purchase Contract, requires that the seller produce the SPDS within three (3) days of contract acceptance, there is no requirement under Arizona law that a seller provide the SPDS to the buyer, as long as the required information is provided to the buyer.
Residential Real Estate Disclosures
Ownership and Property
This section of the SPDS requires the seller to disclose basic information about the identity of the owner of the property, the address of the property, and the age of the property. Also, in residential real estate disclosures, the seller also must disclose whether there are any liens, assessments, or easements on the property, as well as any association fees that apply to the property.
Building and Safety Information
The seller also must disclose basic structural information about the home, including the condition of the roof and any major repairs that are needed or have been completed. This section also addresses plumbing issues, problems with heating and cooling systems, wood infestations, electrical systems issues, and problems with swimming pools, hot tubs, or other water features.
In the third section of the SPDS, the seller must provide information about the utility services available at the home, such as electricity, gas or propane, water and sewer, telephone, trash collection, cable, Internet, fire services, and postal delivery.
In residential real estate disclosures, sellers also must disclose any known environmental conditions that exist on the real estate. These issues might include problems with drainage, such as water collecting in the basement. You must disclose noise from nearby highways, train tracks, or airports, as well as the presence of any landfills or toxic waste dumps.
Sewer / Wastewater Treatment
This section of the SPDS addresses the condition of the sewer or wastewater treatment system. You also should disclose the date that you last had the system inspected.
Other Conditions or Factors
The final section of the SPDS is a catch-all section that allows the seller to disclose any other relevant information about the property.
Information Beyond the SPDS
Arizona law requires that sellers provide a few other pieces of information to buyers. For instance, if the home was built before 1978, the seller must disclose that fact and any known presence of lead-based paint. You also must report any lead paint inspections or reports that have been performed on the home. If you are working with a realtor, you also must provide the seller with a disclosure of the last five years of insurance claims on the property, or for the years in which you have owned the property, if less than five years.
If you have other adverse information about the home that might be material to the buyer, you generally may want to disclose it to the buyer. Materially adverse facts are those that a reasonable person who is buying real estate most likely would want to know. If you don’t disclose potentially material information, you run the risk of legal trouble in the future when the seller discovers that you didn’t disclose a fact that might have altered the transaction in some way.
Information That You DON’T Need to Disclose
State law does not, however, require that you disclose some “social” facts about the real estate. For instance, you don’t have to tell the buyer that someone died in the home, even if they did not pass away of natural causes. You do not have to disclose if someone contracted an illness or disease while in the home, or whether a sex offender lives in the area. (But see Lerner v. DMB Realty, LLC, 322 P.3d 909 (Ariz. Ct. App., 1st Div. 2014.)
Allow Us to Meet Your Residential Real Estate Needs
Provident Law® is dedicated to serving our clients by helping them through their residential real estate disclosures. We value our strong relationships with our clients, and we are grateful for the ability to serve them. Call us today at (480) 388-3343 and set up a time to talk to us about your case.