Sellers of residential real estate in New York State will soon no longer have the proverbial “get out of jail free” option of providing a $500.00 credit at closing in lieu of completing and delivering the Property Condition Disclosure Statement (current version available) (“PCDS”) to the Purchaser prior to execution of a contract of sale. Since 2002, it has been highly advisable that residential property sellers take advantage of their statutory right to provide the closing credit to the purchaser of their property, rather than completing the lengthy PCDS and risking exposure to liability based on either false or incomplete statements pertaining to a property in which they may not know everything about. Now, a completed PCDS will required to be (i) executed by all parties, (ii) attached to the binding contract of sale, and (iii) updated simultaneously with the transfer of title or occupancy by the Purchaser (whichever is earlier).
Additionally, the updated PCDS reflects several new questions related to flood history and flood insurance requirements—a link to the revised set of questions can be found here.
To note, the PCDS is still not required in connection with the sale of residential condominium and cooperative units, sales involving estates/trusts, among several other exempt transactions.
The revised law will go into effect March 20, 2024 — meaning that a completed PCDS is required to be provided to any prospective purchaser prior to signing any contract, March 20 or after.
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For more information or if you have any questions, please reach out to your BBG attorney of record or contact us here.
Written by: Craig L. Price and Joshua A. Sycoff, Attorneys in the Firm’s Transactional Department.