Updated August 17, 2026
Disclosure is the cheapest risk management available to a seller and the thing most commonly done badly. The instinct — say as little as possible, let the buyer find what they find — is exactly backwards. A known problem, disclosed clearly and reflected in the price, is very difficult to renegotiate. The same problem discovered by a buyer's inspector in week three is a price reduction, and discovered after closing it is a claim. Everything in this guide follows from that one asymmetry.
California's standard is materiality: a seller must disclose facts materially affecting the value or desirability of the property that are known to the seller and not readily observable.
Three consequences sellers underestimate:
"Known to the seller" includes what your manager knows. Information held by your property manager or on-site manager is generally imputed to you. "I wasn't told" is not the protection owners assume.
As-is does not waive disclosure. Selling as-is means the buyer accepts the physical condition subject to their diligence. It does not permit concealment of a known material fact.
Commercial does not mean caveat emptor. Sophisticated-buyer status changes some things; it does not switch off the duty.
Lead-based paint disclosure for anything built before 1978 — a written disclosure of known lead paint and hazards, delivery of any records or reports you hold, the EPA pamphlet, and a signed acknowledgment retained. This one carries a federal penalty and is trivially easy to comply with, which makes it a strange thing to get wrong. It is nonetheless among the more common omissions on owner-sold buildings.
Natural hazard disclosure identifying whether the property sits in designated hazard areas — fire hazard severity zones, flood zones, earthquake fault zones, seismic hazard areas. Produced by a disclosure company from mapped data. Note that hazard zone maps have been revised, so a parcel not previously designated may be now.
Death on the property within the statutory lookback period, and certain related disclosures.
Mello-Roos and special assessments where applicable — and check the property tax bill for direct assessments, which is where a PACE obligation appears.
Your attorney and escrow will confirm the exact form set for your transaction. The list above is what recurs; it is not a substitute for advice on your specific sale.
These do not appear on a generic California checklist and they are where multifamily disclosure actually bites.
Rent stabilization status and registration history. Whether units are RSO-covered, whether registration is current, and the registry's record of lawful rents. A rent roll that disagrees with the registry is material.
The full rent roll reality. Not just rent — length of tenancy, deposits held, and side agreements. Informal arrangements accumulated over decades bind the buyer, and they surface in estoppels whether or not you mentioned them.
Tenant matters. Pending or threatened evictions, habitability complaints, harassment claims, LAHD complaints, buyout negotiations in progress or recently completed, and any tenant with counsel.
Compliance record. Open citations, systematic code enforcement inspection history, rent escrow program status past or present, and the soft-story retrofit position with permits.
Permit position. The legal unit count versus the physical one. Unpermitted units are material, full stop, and they are discoverable through the permit record.
Insurance history. Prior claims, and any non-renewal. A carrier non-renewal is material and the buyer's own underwriting will surface it regardless.
Physical condition you know about. Prior water intrusion, foundation work, roof repairs, plumbing failures, pest treatments — with documentation where you have it.
Sellers resist disclosure because they think it invites a discount. In practice the sequence works the other way.
A buyer bidding on complete information prices what they know. A buyer who discovers something mid-diligence prices what they fear, which is always worse than the fact — and they now distrust every other number in the file, so they discount those too.
The most expensive outcome available to a seller is a buyer who finds one undisclosed item and re-underwrites the whole building on the assumption that there are more.
Start before listing, not after an offer. The package should exist when the building goes to market.
Write it down. Verbal disclosure is worth very little afterwards. Written, delivered, acknowledged.
Disclose facts, not conclusions. "The sewer line was repaired in 2019, invoice attached" rather than "plumbing is fine."
Include the documents. Reports, invoices, permits, correspondence, prior inspections. If you had a pre-listing condition report run, provide it.
Ask your manager what you do not know. Formally, in writing. Their knowledge is likely imputed to you, so find out what it is.
When in doubt, disclose. The cost of disclosing something immaterial is nothing. The cost of omitting something material is a claim that survives the closing.
Disclosure is not unlimited access to your affairs.
The line is the property and its condition, income and legal status — not your biography.
Does selling as-is protect me?
It allocates the physical condition to the buyer subject to their diligence. It does not permit you to conceal a known material fact, and courts have been consistent about that.
What if I genuinely don't know?
Say so. "No knowledge" is a legitimate answer where it is true. What is not legitimate is avoiding knowledge — declining to ask your manager so you can claim ignorance.
Do I have to disclose a problem I already fixed?
Generally yes, with the documentation of the repair. A disclosed and documented repair is reassuring. The same repair discovered later, undisclosed, reads as concealment.
What about something the tenants complain about but I dispute?
Disclose the existence of the complaint and your position on it. The buyer is entitled to know a dispute exists; you are entitled to state that you disagree.
Can disclosure kill my deal?
Occasionally a buyer walks on something material — which means they would have walked in week three anyway, at greater cost to both of you. What disclosure reliably kills is the post-closing claim.
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