From Haunted Houses to Watery Basements: Division of Real Estate Reminds Home Sellers What Disclosures Are, Aren’t Required

Recent severe weather events in the southeastern United States, and devastating events earlier this year in Ohio in places such as Indian Lake, serve as a reminder to homebuyers and sellers that weather can play an important role in revealing defects in a home. While Ohio isn't known for hurricanes, even a general rainstorm can reveal issues such as a watery basement.

To bolster transparency and protect the interests of both property buyers and sellers, the Division is highlighting the importance of adhering to those disclosure requirements when engaging in real estate transactions.

"These requirements are designed to foster trust and ensure that all parties involved are fully informed about the condition and potential issues related to a property," said REPL Superintendent Daphne Hawk. "These disclosure requirements underscore Ohio's commitment to maintaining a fair, transparent, and equitable real estate market. By ensuring that all material facts are disclosed, both buyers and sellers can engage in transactions with confidence and peace of mind."

Central to disclosure requirements is the Residential Property Disclosure Form. This mandatory form requires sellers to disclose any known material defects or issues with their properties. This includes issues related to:

• Water supply to the property, sewer system, roof, plumbing, electrical, sump pump, mechanical systems, such as HVAC, structural components, and history of water intrusion and wood-destroying insects.
• Knowledge the owners may have about the presence of hazardous materials, underground storage tanks, abandoned wells on the property, flood plains or need for flood insurance, drainage or erosion problems, any past or present zoning issues or changes in the vicinity, assessments or abatements, and any homeowner's association information.
• Information regarding boundary line disputes, encroachments, and shared driveways or walls with other owners.

For properties constructed before 1978, federal regulations also necessitate a Lead-Based Paint Disclosure. This disclosure informs potential buyers about the possible presence of lead-based paint, which poses significant health risks, particularly to small children. Sellers must provide buyers with detailed information on any known lead-based paint hazards.

Ohio law stipulates that sellers disclose any information that could impact the property's value or desirability. Such transparency is vital in helping buyers make informed decisions and safeguarding sellers from future disputes. By requiring these disclosures, the state ensures that buyers have a comprehensive understanding of what they are purchasing, thereby reducing the risk of surprises following the transaction.

There are several exceptions to these disclosure requirements, including new construction, properties that have been transferred by court order such as probate or bankruptcy court, lender-acquired properties, properties held by an executor or trustee, and transactions involving government agencies. Since disclosures are not required in these transaction types, potential buyers of these properties are urged to do their research and due diligence to protect themselves from potential issues.

Additional information on Ohio's residential real estate disclosure requirements, as well as other common real estate snags, are available here on the Division's website.

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Daphne Hawk, Superintendent, Division of Real Estate and Professional Licensing, Ohio Department of Commerce

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The Division of Real Estate & Professional Licensing is a state agency within the Ohio Department of Commerce. The Division licenses and regulates real estate brokers and sales associates who conduct business in Ohio. It ensures the professional competency of licensees and enforces fair business practices throughout the industry.