California Real Estate Broker ExaminationPractice of Real Estate and Mandated DisclosuresMedium
A real estate agent is preparing a listing presentation for a property located in a designated Earthquake Fault Zone in California. Which of the following is TRUE regarding the agent's disclosure obligations for this specific hazard?
- AThe agent is personally responsible for conducting a geological survey to confirm the property's proximity to a fault line.
- BDisclosure of an Earthquake Fault Zone is only mandatory for commercial properties, not residential.
- CThe agent must ensure the seller provides a Natural Hazard Disclosure Statement (NHD) and indicate the property's location within an Earthquake Fault Zone.
- DThe agent is only required to disclose the hazard if the buyer specifically asks about seismic activity.
Show answer & explanationAnswer & explanation
Correct answer: C. The agent must ensure the seller provides a Natural Hazard Disclosure Statement (NHD) and indicate the property's location within an Earthquake Fault Zone.
California law mandates that sellers, through their agents, disclose if a property is located within an Earthquake Fault Zone via the Natural Hazard Disclosure Statement (NHD). This is a statutory requirement, not dependent on buyer inquiry or agent's personal survey.
Why the other options are wrong
- A. Agents are not required to conduct geological surveys; their role is to ensure proper disclosure of known or statutorily required information.
- B. Disclosure of Earthquake Fault Zones applies to both residential and commercial properties in California.
- D. Disclosure of an Earthquake Fault Zone is a mandatory statutory requirement, not contingent on a buyer's specific question.
Earthquake Fault Zone Disclosure
In California, sellers of real property must disclose if the property is located within a state-designated Earthquake Fault Zone, as part of the Natural Hazard Disclosure Statement (NHD).
- Required by the Alquist-Priolo Earthquake Fault Zoning Act.
- Disclosure is made via the Natural Hazard Disclosure Statement (NHD).
- Applies to properties within specific zones of active faults.
- Aims to inform buyers of potential seismic risks.
Memory trick: NHD Covers All Natural Risks Clearly