Seller’s Disclosures in Texas Real Estate Law

Texas law requires sellers of residential real estate to disclose known material defects and conditions to buyers before closing. Failing to disclose — or making false disclosures — can expose sellers to lawsuits, rescission of the sale, and damages long after the transaction closes. This guide explains what Texas sellers must disclose, the exemptions, and what buyers can do if they were misled.

Questions about seller’s disclosures in a Texas real estate transaction? Call Holmes Law, PLLC at (832) 509-0445 for a free consultation with a Houston real estate attorney.

Texas Property Code 5.008 — The Legal Requirement

The Texas seller’s disclosure requirement is found in Texas Property Code § 5.008. This statute requires sellers of residential real property — generally defined as property with not more than one dwelling unit — to give buyers a written notice disclosing the condition of the property. The disclosure must be made on or before the execution of the purchase contract, or within a reasonable time after contract execution if unforeseen circumstances prevent earlier delivery.

The Texas Real Estate Commission (TREC) provides a standard Seller’s Disclosure Notice (TREC Form OP-H) that satisfies the statutory requirement. While use of the TREC form is not technically mandated, it is the standard used in virtually all Texas residential transactions.

What Must Be Disclosed in Texas

The TREC Seller’s Disclosure Notice requires sellers to disclose known defects and conditions across a broad range of categories, including:

• Structural components: Foundation, roof, walls, floors, and ceilings — known defects, previous repairs, or ongoing issues
• Mechanical systems: HVAC, plumbing, electrical, water heater — known problems, age, and condition
• Water and moisture: Known water intrusion, flooding history, drainage issues, mold, or moisture damage
• Environmental hazards: Known asbestos, lead paint (homes built before 1978 have additional federal requirements), underground storage tanks, and hazardous waste
• Legal and title issues: Known easements, encroachments, boundary disputes, deed restrictions, and liens that will survive closing
• HOA information: Whether the property is subject to a homeowners association, mandatory fees, and deed restrictions
• Previous fire or water damage and whether it was repaired
• Termite or pest damage — known infestations or previous treatments

Flood Disclosure Requirements in Texas

Texas added enhanced flood disclosure requirements following Hurricane Harvey. Under Texas Property Code § 5.008 as amended, sellers must disclose:

• Whether the property is located in a FEMA designated 100-year or 500-year flood plain
• Whether the property has flooded at least once in the past five years
• Whether the property is located in a flood pool for a reservoir
• Whether the property has ever been repaired for flood damage
• Whether the seller has ever received flood insurance proceeds for the property

Houston buyers in particular should scrutinize flood disclosures carefully. Given the region’s history with major flooding events, a property that has flooded previously — even if repaired — carries substantially different risk than one that has not. Buyers can verify flood zone status independently through the FEMA Flood Map Service Center.

Who Is Exempt from the Texas Disclosure Requirement?

Not all residential sellers in Texas must provide the TREC disclosure notice. Exemptions under Texas Property Code § 5.008(e) include:

• Sales of newly constructed homes that have never been occupied
• Foreclosure sales (by a lender or trustee)
• Sales by a court-appointed fiduciary (executor, administrator, guardian)
• Transfers between co-owners
• Transfers to a spouse or lineal relative (children, parents, siblings)
• Sales by a governmental entity

Even for exempt transactions, sellers can still be liable for fraud or misrepresentation under Texas common law if they actively conceal material defects or make false statements about the property’s condition.

What Happens If a Seller Fails to Disclose in Texas?

The legal doctrine of caveat venditor — let the seller beware — governs Texas real estate disclosure law. A seller who fails to disclose known material defects can face:

• Rescission of the sale — the buyer can potentially void the transaction
• Actual damages — the cost to repair the undisclosed defect plus any consequential damages
• DTPA claims — buyers who are misled by seller disclosures may have claims under the Texas Deceptive Trade Practices Act, which can provide up to three times actual damages plus attorney fees for knowing violations
• Fraud claims — where the seller actively concealed or misrepresented the property’s condition

What Buyers Should Do With the Seller’s Disclosure

Buyers should review the disclosure notice carefully before the inspection period ends. Key steps:

1. Read every section — do not skim. “Unknown” answers warrant follow-up questions.
2. Compare to the inspection report — if the inspector finds issues the seller did not disclose, that discrepancy is significant
3. Ask about any “yes” answers — if the seller discloses a prior repair, ask for documentation: when was it repaired, by whom, and do they have receipts or permits
4. Verify flood history independently — check FEMA flood maps, Harris County Flood Control District records, and consider a flood elevation certificate for properties in or near flood zones
5. Consult a real estate attorney if disclosures raise serious concerns about the property’s condition or the seller’s honesty

Seller’s Disclosure FAQ

Is a seller’s disclosure required in Texas?

Yes, for most residential real estate sales. Under Texas Property Code § 5.008, sellers of residential property with not more than one dwelling unit must provide a written disclosure notice to buyers. Exemptions exist for new construction, foreclosure sales, transfers between family members, and sales by court-appointed fiduciaries.

When must the seller’s disclosure be provided in Texas?

The disclosure must be provided on or before the execution of the purchase contract. If the seller delivers the notice after the contract is signed, the buyer has the right to terminate the contract within seven days of receiving the notice under Texas Property Code § 5.008(d).

What is the TREC Seller’s Disclosure Notice?

TREC Form OP-H is the standard Texas Real Estate Commission form used to satisfy the seller’s disclosure requirement. It covers structural components, mechanical systems, environmental hazards, flood history, legal issues, and HOA information. The form is available on the TREC website and is used in virtually all Texas residential real estate transactions.

Can a buyer sue a seller for non-disclosure in Texas?

Yes. A buyer who discovers undisclosed material defects after closing may have claims for breach of contract, fraud, negligent misrepresentation, and violations of the Texas Deceptive Trade Practices Act. DTPA claims can provide up to three times actual damages plus attorney fees for knowing violations, making non-disclosure claims particularly significant in Texas.

Does a seller have to disclose flood history in Texas?

Yes. Texas law requires sellers to disclose whether the property is in a FEMA designated flood plain, has flooded within the past five years, is located in a flood pool area, has been repaired for flood damage, or has been the subject of flood insurance proceeds. These disclosures were strengthened after Hurricane Harvey given the significance of flood risk in the Houston area.

What is the “as-is” clause in a Texas real estate contract and does it eliminate disclosure requirements?

An “as-is” clause in a Texas real estate contract means the buyer is accepting the property in its current condition without requiring the seller to make repairs. However, an as-is clause does not eliminate the seller’s disclosure obligations under Texas Property Code § 5.008 or the seller’s liability for fraud and active concealment. A seller who actively conceals a material defect remains liable even with an as-is clause in the contract.

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