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Amended PCDS eliminating $500 credit goes into effect March 20, 2024

The amended Property Condition Disclosure Statement (PCDS) goes into effect Wednesday, March 20, 2024.  The amended PCDS includes language requiring the disclosure of issues related to flooding and removal of the $500 credit if sellers fail or refuse to provide the PCDS. Sellers will no longer have the option of providing the $500 credit in lieu of the PCDS. The DOS had published the amended form here: https://dos.ny.gov/property-condition-disclosure-statement-1

Section 466 of the Real Property Law (RPL) requires real estate licensees acting as an exclusive or non-exclusive listing agent to timely inform each seller represented by that agent of the seller’s obligations to fill out the PCDS. An agent representing a buyer of residential real property, or, if the buyer is not represented by an agent, the agent representing a seller of residential real property and dealing with a prospective buyer, shall have the duty to timely (in any event, before the buyer signs a binding contract of sale) inform such buyer of the buyer’s rights and obligations under the PCDS law.  If an agent performs the aforementioned duties and obligations, the agent shall have no further duties and shall not be liable to any party for a violation of this article.

NYSAR is recommending that licensees provide a copy of the PCDS to the seller and inform the seller to discuss filling out the PCDS with their attorney.  Licensees should not be assisting the seller in filling out the PCDS.

The date the listing was taken has no impact on whether the amended PCDS is required.  NYSAR inquired with the DOS how the amended form may impact current listings taken prior to March 20, 2024.  Below is a summary of the response from DOS.

Section 462(1) of the Real Property Law (RPL) provides, in part, “Except as is provided in section four hundred sixty-three of this article, every seller of residential real property pursuant to a real estate purchase contract shall complete and sign a property condition disclosure statement as prescribed by subdivision two of this section and cause it, or a copy thereof, to be delivered to a buyer or buyer’s agent prior to the signing by the buyer of a binding contract of sale. A copy of the property condition disclosure statement containing the signatures of both seller and buyer shall be attached to the real estate purchase contract.”

If a contract of sale has already been fully executed with the signed disclosure or agreeing to provide the $500 credit, then the seller met their obligation.  If the seller provides the disclosure, at listing, but there is no “buyer” yet, such disclosure is likely not effective since it was not signed by the “buyer” as required under 462(1).  When the “buyer” signs the disclosure, it should conform to the law at the time it was given.  Therefore, if a listing was taken prior to March 20, 2024, and the PCDS was provided by the seller but it was not signed by the buyer prior to March 20, 2024, the new amended PCDS must be used instead.  Likewise, if the listing was taken prior to March 20, 2024, and the seller was going to opt for the $500 credit the seller would need to fill out and provide to the buyer or buyer’s agent the amended PCDS prior to the signing of a binding contract of sale.

Pursuant to the DOS opinion, the following should answer any questions as to whether the amended PCDS would be required.

Amended PCDS Required

  1. If the seller has already provided the PCDS to the buyer and the buyer has not signed the PCDS prior to March 20, 2024, the amended PCDS is required.
  2. If the seller has not provided the PCDS and a binding contract of sale is entered into on or after March 20, 2024, the amended PCDS is required.

Amended PCDS Not required

  1. If the seller has already provided the PCDS to the buyer and the buyer signed prior to March 20, 2024, the amended PCDS is not required.
  2. If the seller and buyer entered into a binding contract of sale prior to March 20, 2024, the amended form is not required.

For FAQ’s about the amended PCDS, click here.

If you have any questions, please contact the NYSAR Legal Hotline.  The Legal Hotline is available Monday-Friday from 9:00am-4:00pm at 518-436-9727.