What California Sellers Must Disclose in 2026: TDS, SPQ, and the New Thirdhand Smoke Law
What Do California Sellers Have to Disclose Before Selling?
California law requires sellers of residential property (1–4 units) to complete a Transfer Disclosure Statement (TDS), a Seller Property Questionnaire (SPQ), and a Natural Hazard Disclosure (NHD) report before the sale closes. Effective January 1, 2026, California also became the first state in the nation to require sellers to disclose any known history of smoking or vaping on the property under AB 455. Failing to disclose accurately exposes sellers to significant legal liability — including lawsuits years after closing if a concealed defect later surfaces.
By Michael Delehanty — Delehanty Group | DRE #01505346 | May 20, 2026
If you're getting ready to sell your home in Walnut Creek or anywhere else in the East Bay, you've probably heard the word "disclosures" more times in the last week than you have in the rest of your life. That's not an accident — California's disclosure requirements are among the most detailed of any state in the country, and for good reason.
This is one of the first conversations I have with every seller before we go to market. The disclosure package isn't just paperwork. It's your legal record of everything you told the buyer before they agreed to purchase. If something goes wrong after closing, that record determines your liability.
Here's what you're required to provide, what's new in 2026, and what to watch out for as you prepare to list.
The Three Core Disclosure Documents
Every California residential sale (1–4 units) requires three foundational disclosure documents. These need to be completed, signed, and delivered to the buyer before they remove contingencies and before the sale closes.
Transfer Disclosure Statement (TDS)
The TDS is the central disclosure form. It's a comprehensive written statement about the property's condition — based on your actual knowledge. The TDS covers:
- Known material defects and any visible issues that could affect the property's value or habitability
- Prior repairs, including whether permits were pulled and what prompted the work
- The condition and age of major systems: plumbing, electrical, heating and cooling, roof, and foundation
- Appliances and fixtures included in the sale
- Environmental concerns: known mold, asbestos, lead paint, or hazardous materials
- Legal issues: liens, encumbrances, easements, code violations, or known neighbor disputes
A few things sellers often get wrong about the TDS. First, you're required to disclose what you know — not what an inspector would find independently. If you repaired a leak three years ago and it hasn't recurred, that repair still belongs in the TDS. Second, "I didn't think it was a big deal" is not a legal defense. California courts determine materiality based on whether the information would affect a reasonable buyer's decision to purchase, or the price they'd be willing to pay.
There are limited exceptions: trust sales where the trustee never occupied the property, probate sales, foreclosures, and certain inter-spousal transfers. But for the vast majority of Walnut Creek and East Bay sellers, the TDS is mandatory.
Seller Property Questionnaire (SPQ)
The SPQ is the companion to the TDS. Where the TDS addresses current condition, the SPQ digs into the property's history. It asks about:
- Unpermitted work: garage conversions, room additions, deck additions, or other improvements made without building permits
- Insurance claims filed on the property
- Disputes with neighbors, the HOA, or the city
- Known defects that aren't visually apparent — even if they've been repaired
- Any government notices received related to the property
The SPQ is where sellers most often underestimate the level of detail required. If you had a mold remediation done five years ago and everything tested clear afterward, that remediation still belongs in the SPQ. If you added a patio without a permit and later pulled one retroactively, document it. The goal isn't to scare buyers off — it's to give them the information they need to make a fully informed decision.
Your agent should review your completed SPQ to confirm that nothing is ambiguous or missing before it goes to the buyer.
Natural Hazard Disclosure (NHD) Report
The NHD report is handled by a third-party disclosure company — your agent will typically order it, and it usually costs $100–$150. It maps your property against California's official hazard zone databases and tells buyers whether your home sits in:
- A seismic fault zone or liquefaction zone
- A landslide or slope instability zone
- A flood hazard area
- A wildfire hazard severity zone
- A dam inundation zone
Most properties in Contra Costa County fall into at least one of these zones. That doesn't mean your home is at risk — it means you're in an area the state tracks for that category of hazard. Buyers receive and sign the NHD report as part of their disclosure review, and it's required before the sale closes.
What's New in 2026: The Thirdhand Smoke Disclosure (AB 455)
This is the one most sellers haven't heard about yet — and it matters.
Effective January 1, 2026, California became the first state in the world to require sellers to disclose any known history of smoking or vaping on the property. The law — AB 455 — was driven by research from San Diego State University documenting the health risks of thirdhand smoke: the chemical residue that settles into carpets, walls, building materials, and furniture long after the cigarettes or vapes are gone. That residue can persist for years and is a documented health risk, particularly for children and people with respiratory conditions.
Here's exactly what this means for you as a seller:
- If you smoke or vape in your home, you must disclose it — regardless of whether you've repainted or replaced the flooring
- If you know a previous owner smoked or vaped on the property, you must disclose that knowledge
- Vaping and e-cigarettes are included — this isn't limited to traditional cigarette smoke
- Cosmetic improvements don't eliminate the disclosure. Fresh paint is not a disclosure. What the law requires is your actual knowledge of the smoking or vaping history.
- The 2026 Environmental Hazards pamphlet now includes a thirdhand smoke section. This is the current version buyers must receive — confirm with your agent that you're using the updated form.
If a buyer discovers evidence of smoking residue after closing — discoloration beneath new paint, odor embedded in wall framing, or a chemical test showing residue markers — and they can demonstrate you knew and didn't disclose, you're exposed to a lawsuit. California allows buyers to pursue non-disclosure claims based on when they discovered the defect, not just when the sale closed. That discovery could come years later.
If you're uncertain whether you need to make this disclosure, the answer is almost always to disclose it. Transparency protects you. Silence creates liability.
East Bay Specifics Worth Knowing
Most of what's in the TDS, SPQ, and NHD applies statewide. But a few Contra Costa County and East Bay details are worth flagging before you go to market.
PSL compliance: The Private Sewer Lateral ordinance requires sellers in Oakland, Berkeley, Richmond, San Pablo, and certain other East Bay cities to have a sewer lateral inspection — and in some cases, repairs — completed before closing. This requirement does not currently apply in Walnut Creek. But if you're selling anywhere outside Walnut Creek proper, confirm with your agent whether the city has a PSL requirement before you list.
Documentary Transfer Tax: Contra Costa County charges $1.10 per $1,000 of sale price — a cost typically paid by the seller at closing. On a $900,000 home, that's $990 coming out of your proceeds. Several East Bay cities also charge city-level transfer taxes on top of the county rate. For a full picture of what sellers pay at the close of escrow, see How Much Will You Net Selling Your Walnut Creek Home in 2026?
Trust and estate sales: If your home is titled in a trust and you've never personally occupied the property, you may be exempt from the TDS. However, you are still required to complete the AB 455 thirdhand smoke disclosure, the SPQ, and the NHD. If your ownership involves a trust or estate, work with a real estate attorney alongside your agent to confirm your disclosure package is complete and appropriate for your situation.
The pre-listing inspection convention: In Walnut Creek and much of the East Bay, sellers typically secure property inspections before coming to market — and buyers use those seller-provided reports rather than ordering their own. This is a local market convention that most out-of-area buyers and agents don't anticipate. Having a thorough pre-listing inspection in hand doesn't replace your disclosure obligations, but it often surfaces items that belong in your TDS and SPQ before you're under contract and under pressure.
How Sellers Get Into Trouble
Post-sale disclosure lawsuits in California are more common than most sellers expect, and they usually stem from one of three patterns:
The first is a repair that was made without full resolution. A roof patch that held for two years before failing. A foundation crack that was epoxy-injected but never addressed structurally. The repair went into the SPQ as "roof repaired" without context — and the buyer later argued the underlying problem wasn't disclosed.
The second is a "this isn't material" judgment call that turns out to be wrong. Sellers decide on their own that a known issue doesn't need to be disclosed because it's small, old, or already repaired. The standard isn't whether you think it's material — it's whether a reasonable buyer would consider it relevant to their decision.
The third, increasingly, will be the thirdhand smoke disclosure. A seller paints over discolored walls, replaces the carpet, and lists. The buyer moves in, notices an odor, runs an air quality test, and finds chemical markers. They check public records and find the property was owned for 20 years by a smoker. That's the scenario AB 455 was designed to address — and why disclosing your knowledge of the property's smoking history upfront is the right call regardless of what cosmetic work you've done.
I've been doing this in the East Bay since 2005, and before that I spent 15 years as a contractor working on homes throughout this market. When I walk through a property before we list, I'm looking at it with both sets of eyes — the agent who needs to price and position it correctly, and the builder who knows what deferred maintenance and undisclosed work look like. If something needs to go in the disclosures, I'll tell you before the buyer's agent or inspector finds it during escrow. That's a much better conversation to have early.
Frequently Asked Questions
Can I sell my California home as-is and avoid the disclosure requirements?
No. "As-is" describes the sale terms — it means you won't make repairs after inspection. It does not eliminate California's disclosure obligations. You're still required to complete the TDS, SPQ, NHD, and AB 455 disclosure regardless of how the sale is structured.
What happens if a buyer discovers something I didn't disclose after we close?
California law allows buyers to file a claim against sellers for non-disclosure. The statute of limitations depends on when the buyer discovered the defect — not just when the sale closed — meaning a concealed issue that surfaces years later can still lead to litigation. Courts can award damages for repair costs, loss in property value, and in cases of willful concealment, potentially more.
Do I have to disclose smoking history under AB 455 if I replaced the carpet and repainted before listing?
Yes. AB 455, effective January 1, 2026, requires disclosure of your actual knowledge — any known history of smoking or vaping on the property. Cosmetic updates don't change what you know. The law requires you to disclose the history of the home, not only its current visible condition.
Is the Natural Hazard Disclosure something I fill out myself?
No. The NHD report is generated by a licensed third-party disclosure company based on California's state hazard zone databases. Your agent orders it on your behalf and delivers the report to the buyer as part of the disclosure package. It is not a form sellers complete — it's a research document tied to your property's specific address.
Am I required to disclose issues I already discovered and fixed before listing?
Yes. Prior repairs — especially for significant issues like plumbing leaks, roof damage, foundation movement, or mold remediation — belong in your TDS and SPQ. Disclosing a repaired issue doesn't kill your sale; buyers appreciate the transparency. Concealing a known repair creates legal liability.
California's disclosure requirements exist to protect both sides of the transaction. Getting them right is one of the most important things you can do before your home goes to market — and the right time to work through them is before you list, not after you're already in escrow.
If you're preparing to sell your Walnut Creek or East Bay home and want to walk through the disclosure process with someone who knows this market well, I'm happy to talk through your specific situation. Text or email me directly — (510) 697-3900 or michael@delehantyre.com — and we'll figure out exactly what needs to be in your package before you go to market.
About Michael Delehanty — Delehanty Group | DRE #01505346
Michael Delehanty is a Walnut Creek-based real estate agent with Compass, specializing in buying and selling homes across the East Bay — including Walnut Creek, Concord, Pleasant Hill, Danville, Orinda, and the surrounding communities.
Before becoming a real estate agent, Michael spent 15 years running his own contracting firm in the East Bay, working on thousands of homes and major projects across the Bay Area. That hands-on construction background gives his clients a distinct advantage: when Michael walks through a property, he sees what most agents simply can't. From structural details to renovation potential, his experience translates directly into sharper pricing, smarter negotiation, and fewer surprises at the inspection table.
Michael has been a licensed Realtor since 2005, bringing more than 20 years of experience to every transaction. He has successfully guided clients through complex situations including short sales, bank-owned properties, investment transactions, and competitive multiple-offer scenarios. Whether you are a first-time buyer, a move-up seller, or an investor, Michael brings the market knowledge and problem-solving skills to get deals done.
What sets Michael apart is his deep roots in this community. He has lived in Walnut Creek for nearly 30 years and is genuinely invested in the people here — not just the properties. He served four years as Auction Chair and Athletic Boosters President at Las Lomas High School, and has been a member of a local book club for eight years. His two daughters grew up here, attending Las Lomas before going on to the University of Washington and Cal Poly San Luis Obispo. When Michael helps you buy or sell a home in Walnut Creek or the surrounding East Bay communities, he is not just doing a transaction — he is working in the neighborhood where he has built his own life.
michael@delehantyre.com | (510) 697-3900 | michaeldelehanty.com
