Seller and Buyer Disclosures and Property Condition Reporting
Seller disclosures
Minnesota's Seller's Property Disclosure Statement (SPDS), Minn. Stat. ch. 513, applies to residential property of one to four units. The seller discloses known conditions - roof, basement water, HVAC, well and septic, environmental hazards, pending assessments - in good faith based on actual knowledge. The seller is not required to inspect the property or hire experts. The statement must be delivered before the purchase agreement is signed, and material changes after delivery should be updated. A buyer who does not receive the statement generally may rescind in writing before closing. Statutory exceptions include newly constructed never-occupied homes, foreclosure and deed-in-lieu transfers, court-ordered transfers, and certain transfers between co-owners or family members.
Minnesota-specific add-ons: the Well Disclosure Certificate (Minn. Stat. ch. 103I), required when the property has a well, with a 'no wells' statement when none exist or all have been sealed; and the radon awareness publication, delivered before signing. Some cities, notably Minneapolis and St. Paul, require a Truth-in-Sale of Housing evaluation. Federal lead-based paint disclosure applies to pre-1978 housing.
Traps
- Saying the seller must 'discover' defects - the standard is actual knowledge.
- Confusing the SPDS with a home inspection or a warranty.
- Overlooking local Truth-in-Housing requirements.
- Missing well and radon documents at the closing table.
Rule of thumb
The SPDS is a knowledge statement, not a guarantee: sellers disclose what they know; buyers protect themselves with inspections and contingencies.
Worked example
A seller whose basement seeped once three years ago and was repaired must disclose the past seepage even though it is currently dry. The seller need not hire an engineer to hunt for hidden cracks, because the statute does not impose a duty to investigate.