Property Condition Disclosure Law: Why Did States Mandate 'Seller Tell All'

Posted: 15 Nov 2007 Last revised: 7 Feb 2008

See all articles by Anupam Nanda

Anupam Nanda

University of Reading - School of Real Estate & Planning, Henley Business School

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Abstract

Thirty-four US states have already enacted some form of seller's Property Condition Disclosure Law. At a time when there is a movement in this direction nationally, this paper attempts to ascertain the factors that lead states to adopt disclosure law. Motivation for the study stems from the fact that not all states have yet adopted the law, and states that have enacted the law have done so in different years. The analytical structure employs hazard models, using a unique set of economic and institutional attributes for a panel of 50 US States spanning 21 years, from 1984 to 2004. The proportional hazard analysis of law adoption reveals that greater number of disciplinary actions tends to favor passage of the law. Greater broker supervision, implying generally higher awareness among real estate agents, seems to have a negative impact on the likelihood of a state adopting a Property Condition Disclosure Law.

Keywords: property condition disclosure, law adoption, hazard analysis, housing price index

Suggested Citation

Nanda, Anupam, Property Condition Disclosure Law: Why Did States Mandate 'Seller Tell All'. Journal of Real Estate Finance and Economics, Vol. 37, No. 2, 2008, Available at SSRN: https://ssrn.com/abstract=1029733

Anupam Nanda (Contact Author)

University of Reading - School of Real Estate & Planning, Henley Business School ( email )

Whiteknights
Reading, Berkshire RG6 6AH
United Kingdom

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