California Real Estate Laws for 2026: Key Changes Buyers, Sellers & Agents Must Know

California’s real estate landscape is shifting in important ways for 2026. From expanded disclosure obligations to updated compliance forms and new marketing requirements, these changes affect residential real estate transactions, rental properties, and how real estate professionals document and present information to clients. Staying up-to-date now protects you from compliance risk and helps you better advise your clients.

1. Expanded Disclosure Requirements in the TDS & SPQ

Third-Hand Smoke / Nicotine Residue Disclosure

Effective January 1, 2026, a new tobacco/nicotine exposure disclosure is required in transactions where a Transfer Disclosure Statement (TDS) is used (typically 1-4 unit residential properties and mobilehomes). Sellers must disclose known tobacco or nicotine residue, third-hand smoke odors, and any history of smoking activities on the property. Steve Lopez Law

This requirement is integrated into the TDS and the Seller Property Questionnaire (SPQ), meaning agents and sellers must provide this information as part of standard transaction disclosures. The California Association of Realtors (C.A.R.) will update SPQ forms to reflect this new disclosure. Steve Lopez Law

Electrical System & Gas Appliance Future Compliance Notice

Another TDS-related requirement becoming effective in 2026 instructs sellers (or their agents) to disclose:

• The existence of any state or local requirements regarding future replacement of gas-powered appliances being transferred with the property.

• A statutory notice recommending an electrical system inspection by a qualified professional, with detailed language about inspecting the electrical service panel(s), wiring, and related components. Pasadena-Foothills REALTORS®

These additions apply where the seller or agent is aware of such requirements or restrictions. They will become part of the SPQ and must be delivered with the TDS. Buyers may have statutory termination rights (typically up to 5 days after delivery) tied to receiving this information. Pasadena-Foothills REALTORS®

2. The TDS & SPQ — What Still Matters in 2026

The Transfer Disclosure Statement (TDS) remains a foundational disclosure form in California residential sales. It requires sellers to disclose known material facts about the property’s condition — including structural issues, systems, fixtures, environmental hazards, and more — before a sale closes. Vokshori Law Group

The Seller Property Questionnaire (SPQ) goes beyond the TDS, covering additional items like known repairs, remodels, disputes between owners, and other material information that may not be reflected in the TDS itself. Accredited Real Estate Schools Inc.

Both forms are required (unless exempt) in most one-to-four unit residential sales, leases longer than one year, and mobilehome sales — and agents are still obligated to ensure they’re completed accurately and delivered in a timely manner. Steve Lopez Law

Note: Even in “as-is” transactions, the TDS can’t usually be waived, and sellers must deliver it before transfer of title. Justia Law

3. New & Updated Compliance Documents (Forms)

C.A.R. Updates for 2026:
The California Association of Realtors (C.A.R.) has released new and revised forms ahead of 2026 that reflect legislative changes. These include updates to:

• SPQ (Seller Property Questionnaire)

• Buyer & Seller agreements

• Buyer Representation forms

• Notice and compliance forms

These form updates ensure that required disclosures — like nicotine residue, electrical inspection recommendations, and compliance with new laws — are captured properly in transactions. Tyler Law LLP

Agents should review and adopt 2026 versions of these mandatory and recommended forms in all new transactions.

4. Transparency in Marketing & Advertising

Digital Image Disclosure (AB 723):
California now requires disclosure whenever property images are digitally altered (including AI enhancements, virtual staging, adding/ removing fixtures, etc.). This goes into effect January 1, 2026.

• Altered photos must include a clear disclosure near the image.

• Agents must provide access (via link, URL, or QR code) to the original, unedited photos. Lewis Brisbois

Standard photo adjustments like exposure, lighting, and cropping are not considered alterations that require disclosure. Lewis Brisbois

Updating MLS processes and marketing templates now will help avoid compliance issues when publishing listings.

5. Habitability & Rental Unit Changes

While this is focused mostly on residential sales disclosure, it’s important for investor clients and property managers:

Stove & Refrigerator Habitability Requirement:
A new habitability standard effective in 2026 requires rental units to include working stoves and refrigerators unless narrowly exempt. This change affects lease negotiations and habitability documentation. California Apartment Association

6. Other Document & Transactional Requirements to Watch

Written Buyer Representation Agreements:
Although this rule became effective in 2025, it continues to impact 2026 transactions: buyer brokers must have signed written representation agreements outlining services and compensation before earning a commission. BakerHostetler

Natural Hazard & Supplemental Disclosures:
Standard required disclosures — like the Natural Hazard Disclosure Statement (NHDS) covering fire, flood, earthquake, and other mapped hazards — remain integral and must still be delivered alongside TDS and SPQ documents. Wikipedia

7. Why These Changes Matter

These updates reflect California’s push toward greater consumer protection and transactional transparency. For agents and brokers, understanding and incorporating these changes into your workflow:

• Reduces risk of liability and disputes

• Improves client trust

• Helps you operate with modern compliance standards

For sellers, complying with expanded disclosures helps avoid post-close disputes. For buyers, these documents and notices ensure they’re fully informed before entering into a binding contract.

8. Practical Takeaways for 2026

✔ Review and adopt updated TDS and SPQ forms early.
✔ Train your team on new disclosures — especially nicotine & electrical/gas appliance notices.
✔ Update marketing policies to comply with digital image disclosure rules.
✔ Ensure written buyer representation agreements are in place as required.
✔ Stay current on updated C.A.R. forms and DRE guidelines.

Property Defect Nondisclosure Liabilities: Common Claims Leading to Buyer Lawsuits

In the world of US real estate transactions, few issues spark more litigation than the failure to disclose known property defects. Even in today's more balanced market, nondisclosure remains a leading driver of lawsuits against sellers and agents alike. According to recent industry data from major E&O carriers, negligence claims topped the list in 2024 with approximately 3,450 incidents, closely followed by misrepresentation claims at around 2,097. Many of these stem directly from undisclosed or inadequately revealed defects like hidden mold, foundation issues, water damage, or unpermitted work.

These claims aren't just numbers—they represent real financial and emotional devastation for buyers discovering costly problems post-closing, and potentially career-threatening liability for professionals. As a real estate risk management specialist with years of experience advising agents, brokers, and investors, I've seen how proactive disclosure practices can prevent these pitfalls. In this post, we'll explore real-world trends, break down what goes wrong, examine legal ramifications, and—most importantly—provide actionable strategies to protect your transactions.

The Cautionary Reality: Rising Trends in Nondisclosure Claims

Buyers today are more informed and litigious, especially after periods of waived inspections in competitive markets. Post-closing discoveries of defects often lead to allegations that sellers or agents knew (or should have known) about issues but failed to disclose them properly.

Common scenarios from 2024–2025 claims data include:

• Hidden mold or prior water intrusion not mentioned on disclosure forms.

• Foundation cracks or structural shifts concealed by cosmetic repairs.

• Leaking roofs, faulty plumbing, or electrical problems downplayed as "minor."

• Unpermitted renovations that violate building codes, exposing buyers to retrofit costs.

These issues often surface months or years later, triggering E&O claims with escalating severity due to inflation in repair costs. Industry reports note that nondisclosure-related misrepresentation is among the top E&O triggers, with payouts reaching six figures in severe cases.

What Goes Wrong: Breaking Down the Failures

At the heart of these claims is a breach of duty. Sellers have a legal obligation in most states to disclose known "material defects"—issues that could affect the property's value, desirability, or safety and aren't readily observable by buyers.

Common breakdowns include:

• Incomplete or inaccurate state-mandated disclosure forms (e.g., California's Transfer Disclosure Statement or similar in other states).

• Overreliance on "as-is" sales without full transparency—courts have ruled that "as-is" doesn't waive disclosure duties for latent defects.

• Agents failing to probe sellers thoroughly or overlooking red flags during walk-throughs.

• Negligent misrepresentation: Providing info without verifying accuracy, like accepting seller statements at face value.

Vicarious liability can pull agents in if they "should have known" through reasonable diligence. In rushed transactions, these oversights multiply.

Legal Implications: The High Stakes of Nondisclosure

Buyers pursuing claims can seek:

• Actual damages (repair costs, diminished value).

• Attorney fees and court costs (common in many states).

• Punitive damages for intentional fraud.

• Rescission (rare, but possible in extreme cases).

Statutes of limitations typically run 2–4 years from discovery, but claims often arise quickly. Agents face E&O exposure, while sellers risk personal liability. Trends show increasing claim frequency and severity, driven by buyer awareness and soaring remediation expenses.

Expert Prevention Strategies: Safeguard Your Deals

The best defense is offense: Robust disclosure and documentation protocols. Here's my recommended framework:

1. Mandate Comprehensive Seller Questionnaires: Go beyond basic forms—use detailed supplements probing prior repairs, insurance claims, or neighbor complaints.

2. Require Independent Inspections: Even in "as-is" sales, encourage (and document advice for) professional home inspections.

3. Document Everything in Writing: Capture verbal disclosures, emails, and advisories. Never fill out forms for sellers.

4. Use Targeted Checklists: Focus on high-risk areas.

Final Thoughts: Transparency Builds Trust—and Protects Careers

Property defect nondisclosure isn't just a legal risk; it's a trust breaker in an industry built on relationships. By prioritizing thorough, documented transparency, you not only minimize liability but elevate your professional reputation. In my experience, agents who master these practices close more deals confidently and sleep better at night.

If you're facing a potential disclosure issue or want tailored risk management advice, reach out—proactive guidance is always cheaper than litigation.

Sources: Insights drawn from 2024–2025 E&O claim trends reported by carriers like Victor Insurance and CRES, NAR guidance, and state disclosure statutes.

Finding Calm in Chaos: The Story Behind GS Wellness and Events

In today’s fast-paced, pressure-filled world, it’s easy to feel overwhelmed, anxious, and completely disconnected. That’s exactly why GS Wellness and Events exists. Founded by Natasha Sudsbury, this wellness-focused company is more than a brand, it’s a lifeline for those who are ready to feel grounded again, inside and out.

Natasha didn’t create GS Wellness and Events because wellness was trending. She started it because she needed it herself. Like so many of the people she now helps, Natasha found herself juggling responsibilities, stress, and a constant undercurrent of anxiety. But instead of pushing it aside, she started searching for real ways to feel better mentally, emotionally, and physically. And in that process, she discovered a passion for helping others do the same.

GS Wellness and Events was born from that personal journey, and Natasha built it with one clear goal: to help businesses boost their branding, revenue, employee retention by using scent psychology and wellness-focused events. Her work creates memorable experiences that reduce stress, improve team connection, and strengthen company culture.

Since launching, the business has naturally evolved. What started as a personal project has grown into a trusted resource for clients who are tired of surface-level advice and want something deeper. Natasha remains closely involved in every aspect of the work, ensuring that each client interaction feels personal, warm, and truly supportive.

Since launching, the business has naturally evolved. What started as a personal project has grown into a trusted resource for clients who are tired of surface-level advice and want something deeper. Natasha remains closely involved in every aspect of the work, ensuring that each client interaction feels personal, warm, and truly supportive.

Of course, like any founder, she’s faced her share of challenges. From learning how to balance growth with integrity, to navigating the emotional toll of holding space for others, Natasha has leaned into her core values, compassion, honesty, and service, to stay grounded and clear on her mission. It’s those same values that shine through in every session, every tool, and every conversation with her clients.

One major turning point in Natasha’s journey was her experience with The Blox. She joined the program looking for new strategy ideas, but what she got was so much more. Surrounded by entrepreneurs who were just as passionate and purpose-driven, she found a community that helped sharpen her vision and validate her values. A moment that stood out most was when someone shared this insight: “Your business should be an extension of your values, not a mask you wear.” That resonated deeply and it’s been a guiding principle for GS Wellness and Events ever since.

So what makes Natasha and GS Wellness and Events different? It’s the heart behind everything she does. Clients often describe their sessions with her as “like talking to someone who truly gets it.” There’s no judgment, no rush, no rigid checklist. Natasha meets people where they are and walks with them at their pace. It’s not about fixing anyone, it’s about creating space for people to finally feel like themselves again.

Natasha also stays innovative, constantly learning and adjusting her approach as new tools and research emerge. Wellness isn’t one-size-fits-all, and she knows that deeply. Her work is fluid, responsive, and thoughtfully crafted around each client’s unique needs.

Looking ahead, Natasha has big plans for GS Wellness and Events. She’s exploring new digital programs, expanding her offerings to make them more accessible, and even considering in-person retreats. But no matter how the business grows, the mission remains steady: helping people find clarity, calm, and confidence in their daily lives.

For Natasha, success isn’t just about profit. It’s about moments, like when a client sleeps better, sets a boundary, or tells her, “I finally feel like myself again.” That’s the true win.

And on the days when things get tough? Natasha turns to the very practices she teaches. Whether it’s a walk in nature, a quiet journaling session, or simply giving herself permission to pause, she leads by example. Her approach isn’t just professional, it’s personal.

When she’s not working, Natasha recharges by spending time outdoors, staying connected with friends and family, and making space for joy. That sense of balance is something she lives out in her own life and encourages in others, because wellness isn’t just a service she provides. It’s a way of being she invites all of us to explore

GS Wellness and Events is based in the Tampa, Florida area and more information can be found on their website www.gswellnessevents.com

Real Estate Disclosures in California: What You Need to Know

When buying or selling a home in California, there’s one important aspect that shouldn’t be overlooked: real estate disclosures in California. These disclosures help ensure transparency, protecting both buyers and sellers throughout the transaction. In this post, we’ll break down the types of disclosures required in California real estate transactions and why they are crucial to the process.

What Are Real Estate Disclosures in California?

Real estate disclosures in California refer to the legal obligations sellers have to reveal specific information about the property being sold. These disclosures cover a wide range of potential issues that could impact the value, safety, or usability of the property. California law is particularly strict when it comes to disclosure requirements, and failing to disclose critical information can result in significant legal consequences for the seller.

Types of Real Estate Disclosures in California

There are several types of real estate disclosures in California that sellers are required to provide. Here are some of the most common ones:

1. Transfer Disclosure Statement (TDS)

One of the most important real estate disclosures in California is the Transfer Disclosure Statement (TDS). This document provides a comprehensive overview of the property’s condition. Sellers must disclose known defects or issues, such as electrical problems, roof leaks, plumbing issues, or other material facts that could affect the property’s value. The goal is to give buyers a clear understanding of the property they are purchasing.

2. Natural Hazard Disclosure (NHD)

Another key requirement is the Natural Hazard Disclosure (NHD). This document informs buyers whether the property is located in a natural hazard zone, such as a flood, earthquake, or wildfire zone. Given California’s geographic diversity, this disclosure is critical for ensuring that buyers are aware of potential environmental risks that may affect the property.

3. Seller Property Questionnaire (SPQ)

The Seller Property Questionnaire (SPQ) is an additional document where sellers provide more detailed information about the property. This includes any issues with appliances, repairs made, or neighborhood concerns. Like the TDS, the SPQ is designed to give buyers a fuller picture of the home’s history and condition.

4. Lead-Based Paint Disclosure

For homes built before 1978, real estate disclosures in California require sellers to provide a Lead-Based Paint Disclosure. This law exists to protect buyers from the potential dangers of lead-based paint, which can be harmful, especially to children and pregnant women.

Why Are Real Estate Disclosures in California Important?

The importance of real estate disclosures in California cannot be overstated. These disclosures protect both buyers and sellers by ensuring transparency in the transaction. Here’s why they matter:

• For Buyers: Disclosures give buyers peace of mind, allowing them to make informed decisions about the property. By reviewing the property’s condition and any potential risks, buyers can factor in repair costs or other considerations into their offer.

• For Sellers: Disclosures protect sellers from future liability. By being upfront about the property’s condition, sellers can avoid legal disputes after the sale. If a buyer discovers an issue after closing that wasn’t disclosed, the seller could face significant legal consequences.

• For Realtors: For real estate agents, helping clients navigate real estate disclosures in California is essential. Ensuring that all disclosures are completed accurately and on time can help realtors avoid delays in closing and protect their clients’ interests.

Conclusion

Understanding real estate disclosures in California is critical for all parties involved in a real estate transaction. From the Transfer Disclosure Statement to the Natural Hazard Disclosure, these documents provide buyers with important information about the property, protect sellers from potential legal action, and help realtors facilitate smoother transactions. If you’re involved in a real estate deal, make sure you fully understand the disclosure requirements to protect yourself and your investment.

For expert assistance with reviewing real estate documents and ensuring all disclosures are properly handled, House Owl is here to help. Contact us to learn how we can provide peace of mind in your next real estate transaction.

Understanding the National Association of Realtors Settlement: A Turning Point in Real Estate

In a landmark development within the real estate industry, the National Association of Realtors (NAR) recently reached a significant settlement, marking a pivotal moment that promises to reshape the landscape of real estate transactions. This settlement comes as a response to years of legal scrutiny and allegations regarding the NAR’s practices and their impact on competition within the market.

### The Background

For decades, the NAR has held a dominant position in the real estate industry, serving as a powerful advocate for real estate agents and brokers across the United States. However, this influence has not been without controversy. Over the years, critics have raised concerns about the NAR’s policies, particularly those related to commission rates, access to property listings, and the structure of the Multiple Listing Service (MLS).

### The Allegations

The crux of the allegations against the NAR revolves around its policies regarding the sharing of property listings and the requirement for agents to represent sellers, even if buyers are interested in purchasing a property without representation. Critics argue that these practices stifle competition, limit consumer choice, and artificially inflate commission rates, ultimately disadvantaging both buyers and sellers in the real estate market.

### The Settlement

The recent settlement reached by the NAR marks a significant departure from its previous practices. Under the terms of the settlement, the NAR has agreed to implement a series of reforms aimed at promoting greater competition and transparency within the real estate industry. Key components of the settlement include:

1. **Greater Access to Property Listings**: The NAR has committed to providing greater access to property listings, allowing non-traditional brokerages and online platforms to compete more effectively in the market.

2. **More Flexibility for Buyers**: Buyers will now have the option to purchase properties without representation from a traditional real estate agent, giving them greater flexibility and control over the home buying process.

3. **Increased Transparency**: The NAR will implement measures to ensure greater transparency in real estate transactions, including clearer disclosure of commission rates and fees.

4. **Reform of MLS Policies**: The structure of the MLS will undergo significant reform to promote fair competition and ensure that all market participants have equal access to property listings and information.

### The Implications

The settlement reached by the NAR has far-reaching implications for the real estate industry as a whole. By addressing long-standing concerns about competition and transparency, the reforms outlined in the settlement promise to create a more level playing field for all market participants.

For consumers, these changes mean greater choice and flexibility when buying or selling a home. For real estate agents and brokers, the reforms present both challenges and opportunities, as they adapt to a more competitive and transparent marketplace.

### Conclusion

The settlement reached by the National Association of Realtors represents a significant milestone in the ongoing evolution of the real estate industry. By addressing concerns about competition and transparency, the reforms outlined in the settlement promise to usher in a new era of innovation and opportunity for buyers, sellers, and real estate professionals alike. As the industry continues to evolve, it is clear that the NAR’s settlement will serve as a catalyst for positive change, shaping the future of real estate for years to come.