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Property Disclosure Statement Guide: What Landlords, Tenants, and Investors Need to Know

Learn everything about property disclosure statements, including legal requirements for sellers, what tenants should know when their rental is being sold, and how investors can protect themselves during transactions.

Introduction

A Property Disclosure Statement is a legally significant document that requires property sellers to reveal known material defects and issues with a property. Whether you're a tenant whose rental home is being sold, a landlord selling your rental property, or a real estate investor managing multiple properties, understanding disclosure requirements is crucial to protect your interests and avoid potential legal disputes. This guide explains what property disclosure statements entail, who needs to complete them, what must be disclosed, and how these documents affect different parties in real estate transactions.

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Key Things to Know

  1. 1

    Property disclosure requirements vary by state, so always check your local laws or consult with a real estate attorney to understand specific obligations in your area.

  2. 2

    Disclosure statements typically cover known issues only—sellers generally aren't required to hire inspectors to discover unknown problems.

  3. 3

    For landlords selling rental properties, tenant-reported maintenance issues should be included in your disclosures, even if you haven't personally verified them.

  4. 4

    Tenants' lease rights are generally protected when a rental property is sold; the new owner typically must honor existing lease terms.

  5. 5

    Real estate investors should maintain detailed property records and consider pre-listing inspections to facilitate accurate disclosures.

  6. 6

    Selling a property 'as-is' does not exempt sellers from disclosure requirements—you must still disclose known material defects.

  7. 7

    The consequences of inadequate disclosure can include lawsuits, monetary damages, rescission of the sale, and significant legal expenses.

  8. 8

    When in doubt about whether to disclose something, the safer legal approach is to include it in your disclosure statement.

Key decisions before you file

Before you file a Property Disclosure Statement in Pennsylvania, a few decisions shape the document: which option to choose and what each one means. The Property Disclosure Statement guide walks through them.

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Pennsylvania Requirements for Property Disclosure Statement

  • Pennsylvania Real Estate Seller Disclosure Law (68 Pa. C.S. § 7301-7315)

    Requires sellers to disclose known material defects in the property through a disclosure statement before signing an agreement of sale. This law defines material defects as problems that would have a significant adverse impact on the value of the property or unreasonable risk to people on the property.

  • Structural Components Disclosure (68 Pa. C.S. § 7304)

    Requires disclosure of known defects in structural components including foundation, roof, walls, floors, ceilings, windows, doors, and other structural elements of the property.

  • Water and Sewage Systems Disclosure (68 Pa. C.S. § 7304)

    Mandates disclosure of known problems with water supply, plumbing system, water heater, sewage system, and any water or sewage-related issues including the source of water supply and type of sewage system.

  • Lead-Based Paint Disclosure (42 U.S.C. § 4852d; 24 CFR Part 35; 40 CFR Part 745)

    Federal law requiring disclosure of known lead-based paint and lead-based paint hazards in housing built before 1978, including providing buyers with an EPA-approved information pamphlet and records available concerning lead-based paint.

  • Mechanical Systems Disclosure (68 Pa. C.S. § 7304)

    Requires disclosure of known defects in mechanical systems including electrical, heating, cooling, appliances, and other major home systems.

  • Environmental Hazards Disclosure (68 Pa. C.S. § 7304)

    Mandates disclosure of known environmental hazards on the property including but not limited to radon, mold, underground storage tanks, and other toxic substances.

  • Flood Zone Disclosure (68 Pa. C.S. § 7304)

    Requires disclosure if the property is located in a flood zone or wetlands area, or if there have been any flooding issues on the property.

  • Property Boundaries and Encroachments (68 Pa. C.S. § 7304)

    Requires disclosure of known boundary disputes, encroachments, easements, or shared features (such as driveways or fences) that may affect property rights.

  • Homeowners Association Disclosure (68 Pa. C.S. § 7304; 68 Pa. C.S. § 4409 (Uniform Planned Community Act))

    Requires disclosure of the property's inclusion in a homeowners association, condominium, or planned community, including fees, restrictions, and other relevant information.

  • Historic Preservation Designation (68 Pa. C.S. § 7304)

    Requires disclosure if the property is subject to historic preservation restrictions or is located in a historic district that may limit modifications to the property.

  • Mine Subsidence Disclosure (68 Pa. C.S. § 7304; 52 P.S. § 1406.14)

    Pennsylvania-specific requirement to disclose if the property is undermined or subject to mine subsidence, particularly relevant in areas with historic coal mining activity.

  • Zoning Violations Disclosure (68 Pa. C.S. § 7304)

    Requires disclosure of known zoning violations, non-conforming uses, or zoning classification that may affect the property's use.

  • Legal Issues Disclosure (68 Pa. C.S. § 7304)

    Requires disclosure of pending legal actions, violations of building codes, or other legal matters affecting the property.

  • Megan's Law Disclosure (42 Pa. C.S. § 9799.10-9799.41)

    Pennsylvania law does not require disclosure of nearby sexual offenders, but prohibits misrepresentation if asked directly. The disclosure statement typically includes language informing buyers about the publicly available sexual offender registry.

  • Cemetery/Burial Ground Disclosure (68 Pa. C.S. § 7304)

    Requires disclosure if the property contains a cemetery, burial ground, or human remains.

  • Agricultural Use Disclosure (68 Pa. C.S. § 7304; 3 P.S. § 951-957)

    Requires disclosure if the property is protected agricultural land or subject to agricultural use restrictions, or if it's located near agricultural operations protected under Pennsylvania's Right to Farm Act.

  • Water/Soil Contamination Disclosure (68 Pa. C.S. § 7304)

    Requires disclosure of known soil or water contamination issues, including issues with potability of water if from private sources.

  • Mold Disclosure (68 Pa. C.S. § 7304)

    While not specifically mandated as a separate item, known mold problems must be disclosed as they constitute material defects under Pennsylvania law.

  • Seller's Expertise Disclosure (68 Pa. C.S. § 7308)

    Pennsylvania law specifies that sellers are only required to disclose material defects known to them, and are not obligated to conduct any specific inspection or investigation of the property.

  • Radon Disclosure (68 Pa. C.S. § 7304)

    Requires disclosure of known radon hazards and any radon testing or mitigation that has been performed on the property.

Frequently Asked Questions