N.C. REALTORS® successful in passing Property Disclosure Law

At the request of the North Carolina Association of REALTOR®., Inc., legislation has been passed by the North Carolina General Assembly requiring owners of residential real estate to furnish purchasers a Residential Property Disclosure Statement regarding the condition of their property. The law (N.C.G.S. 47E) goes into effect January 1, 1996 and applies to sales whether or not the owner is assisted by a real estate broker or salesman. Owners must either identify and describe the condition of various components of their property (water supply, plumbing, heating, environmental problems, etc.); or state that they are not aware of any problems; or elect to make "no representations" about the condition of their property.

Although authorized by the law to charge for the form, the Real Estate Commission will furnish single copies of the Residential Property Disclosure Statement free to real estate licensees and the public upon request. Licensees and consumers may duplicate the form if additional copies are needed. Also, to assist owners in understanding and completing the Statement, the Commission has developed Guidelines which appear on the reverse side of the form and summarize some of the most important provisions of the new law.

When acting as the agent of an owner, real estate brokers and salesmen must inform owners of their rights and obligations under the new law. If an agent has informed the owner that the owner must give the form to prospective purchasers and the owner willfully refuses to do so, the agent will not be held responsible to the purchaser.

Agents must retain in their files for a period of three years a copy of each Statement given to prospective purchasers [Commission Rule A.0108]. Furthermore, regardless of the owner's representations in the disclosure statement, the agent must continue to disclose to prospective purchasers any material facts about the property which the agent knows or should reasonably know.

Brokers and salesmen are encouraged to make copies of the Statement and Guidelines from pages 11 and 12 of this Bulletin and furnish them to real estate sellers. Sellers with questions concerning the new law should be referred to their private attorneys.