One of the most important—and sometimes misunderstood—parts of a real estate transaction is disclosure. At its core, the rule is simple: sellers and their agents have a duty to disclose material facts that affect the value or desirability of a property when those facts are not known to the buyer or easily discovered through normal observation.
In practice, however, disclosure is not always as straightforward as it sounds.
What Is a “Material Fact”?
A material fact is any information that could influence a buyer’s decision to purchase a property or the price they are willing to pay. This often includes prior inspection reports, known defects, past repairs, or recurring issues such as water intrusion, foundation concerns, or roof problems.
If a buyer would reasonably want to know about an issue before making an offer, it likely qualifies as material.
What Buyers Are Expected to Discover
Buyers are expected to exercise “diligent attention and observation” when evaluating a property. This means noticing visible issues during showings and inspections—such as obvious wear, visible cracks, or aging systems.
However, buyers are not expected to uncover hidden defects, past problems that have been repaired, or conditions that are not readily observable without specialized knowledge or access to records.
The Seller and Agent’s Responsibility
Sellers and agents cannot assume that silence is acceptable just because an issue has been repaired or is no longer active. Prior reports and repairs often must be disclosed, especially if they relate to structural integrity, safety, or ongoing maintenance concerns.
Transparency helps prevent misunderstandings, disputes, and potential legal issues after closing.
Why Disclosure Protects Everyone
Proper disclosure builds trust and reduces risk for all parties involved. Buyers can make informed decisions, plan for future maintenance, and feel confident in their purchase. Sellers reduce the likelihood of future claims or accusations of misrepresentation.
While it can feel uncomfortable to disclose past issues, failing to do so can lead to far greater consequences down the road.
When in Doubt, Disclose
Because the definition of “material” can vary depending on the situation, a good rule of thumb is simple: when in doubt, disclose. Consulting with a knowledgeable real estate professional or legal advisor can help clarify what should be shared.
Disclosure is not about pointing out every minor imperfection—it’s about honesty and transparency. Prior reports and repairs that affect a property’s value or desirability should be disclosed when buyers wouldn’t reasonably discover them on their own.
Clear communication protects buyers, sellers, and agents alike—and helps ensure smoother, more successful transactions.
If you’re considering a move or investment and require a trusted Real Estate Broker, we’re here to assist you. Contact us via email at TEAM@McDanielCallahan.com, complete the form below, or give us a call at 925-838-4300. We are ready to provide expert guidance and support for all your real estate needs. Terry McDaniel DRE License #00941526
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