Property Condition Disclosure Statement

New York State Amends Requirements A Property Condition Disclosure Statement (PCDS) is a form required by the State of New York (Division of Licensing and Services), to be completed by a seller of residential real estate, prior to the signing of a residential contract of sale by a Purchaser (New York State Real Property Law Section 462).  This form discloses various relevant information regarding the residential real property being sold.  The form can be found on the following governmental website: property-condition-disclosure-statement.pdf (ny.gov).  The PCDS law currently requires a seller of residential real property to either provide a completed PCDS form, prior to a purchaser signing a contract, or to provide a purchaser with a monetary credit in the amount of $500.00, which is customarily provided as an adjustment at closing of title.  Given the potential post-closing exposure to a seller providing a completed PCDS form, most seasoned real estate attorneys and real estate agents advise sellers to simply provide the monetary credit, inasmuch as it ensures that once a closing occurs there is no surviving liability for any alleged failure to properly disclose conditions relevant to the home or property (excluding known and concealed latent defect). 

In large part, due to the fact that sellers rarely, if ever, complete and deliver this form to a purchasers, due to potential liability concerns, the State of New York has amended the law, effective March 20, 2024, to repeal the portion of the law which permits a seller to provide a monetary credit of $500.00, to a purchaser, in lieu of providing the completed PCDS form, prior to contract.  The law change now mandates that this form be completed by every seller of residential real property, except in the cases where an exemption applies (as enumerated in RPL Section 463). 

Additionally, there will be a new PCDS form, which is not available yet, which will include seven additional disclosure questions, regarding flood zones and flood history.  There is no specific date on which the new form will be issued, although the seven new questions have been published in the revised Law.  As with the prior PCDS, it seems that the onus of having the PCDS form prepared will fall on the real estate agent, more specifically the listing agent.  My suggestion is that this form be provided to sellers and completed at the time when the property is listed for sale and provided to a purchaser prior to the time an offer is made.