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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 South Carolina, 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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South Carolina Requirements for Property Disclosure Statement

  • South Carolina Residential Property Condition Disclosure Act (S.C. Code Ann. § 27-50-10 et seq.)

    Requires sellers of residential real property to provide a written disclosure statement to purchasers. The disclosure must include known material defects that would affect the value of the property.

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

    Requires disclosure of known lead-based paint and lead-based paint hazards in housing built before 1978, including providing purchasers with an EPA-approved lead hazard information pamphlet.

  • South Carolina Disclosure of Stigmatized Property (S.C. Code Ann. § 27-50-90)

    South Carolina law does not specifically require disclosure of psychological stigmas (such as deaths, murders, or paranormal claims) unless they materially affect the physical condition of the property.

  • Coastal Zone Management Act Disclosure (S.C. Code Ann. § 48-39-10 et seq.)

    Properties in coastal areas must disclose information about coastal zone management regulations, erosion, and flood hazards that may affect the property.

  • Flood Zone Disclosure (S.C. Code Ann. § 27-50-40)

    Sellers must disclose if the property is located in a designated flood zone or if the property has experienced flooding, as this information is material to the property's value.

  • Methamphetamine Production Disclosure (S.C. Code Ann. § 44-53-1650)

    Requires disclosure if the property was used for methamphetamine production, as this creates health hazards that materially affect the property.

  • Homeowners Association Disclosure (S.C. Code Ann. § 27-50-40)

    Sellers must disclose the existence of any homeowners association, mandatory fees, and restrictive covenants that apply to the property.

  • Wetlands Disclosure (S.C. Code Ann. § 48-39-280)

    Properties containing designated wetlands must disclose this fact and any restrictions on development or use that result from wetlands regulations.

  • Mold and Moisture Disclosure (S.C. Code Ann. § 27-50-40)

    Known presence of mold or moisture problems must be disclosed as they constitute material defects affecting health and property value.

  • Radon Gas Disclosure (S.C. Code Ann. § 27-50-40)

    Known presence of radon gas must be disclosed as it constitutes a material defect affecting health and property value.

  • Underground Storage Tank Disclosure (S.C. Code Ann. § 27-50-40; S.C. Code Ann. § 44-2-60)

    Presence of underground storage tanks must be disclosed due to potential environmental hazards and liability issues.

  • Structural Defects Disclosure (S.C. Code Ann. § 27-50-40)

    Known structural defects, including foundation issues, roof problems, and other significant structural concerns must be disclosed.

  • Water and Sewer System Disclosure (S.C. Code Ann. § 27-50-40)

    Information about the property's water supply (public, well, other) and waste disposal system (public sewer, septic tank, other) must be disclosed.

  • Electrical and HVAC System Disclosure (S.C. Code Ann. § 27-50-40)

    Known defects in electrical systems, heating, ventilation, and air conditioning systems must be disclosed.

  • Boundary Dispute Disclosure (S.C. Code Ann. § 27-50-40)

    Known boundary line disputes, encroachments, or unrecorded easements affecting the property must be disclosed.

  • Toxic Substances Disclosure (15 U.S.C. § 2601 et seq. (Toxic Substances Control Act))

    Federal law requires disclosure of known toxic substances on the property, including asbestos, that could pose health risks.

  • Military Airport Noise Zone Disclosure (S.C. Code Ann. § 27-50-40)

    Properties located in designated military airport noise zones must disclose this information as it may affect property value and quality of life.

  • Beachfront Management Act Disclosure (S.C. Code Ann. § 48-39-250 et seq.)

    Properties subject to South Carolina's Beachfront Management Act must disclose restrictions on development and potential erosion issues.

  • Exemption from Disclosure Statement (S.C. Code Ann. § 27-50-30)

    Certain transactions are exempt from disclosure requirements, including transfers pursuant to court order, between co-owners, and to or from a government entity.

  • Material Fact Misrepresentation (S.C. Code Ann. § 40-57-350; 15 U.S.C. § 1701 et seq.)

    Federal and state laws prohibit misrepresentation of material facts in real estate transactions, which can lead to claims of fraud or negligent misrepresentation.

Frequently Asked Questions