SB 286 — Historic districts; required disclosure for buyer to beware, due diligence.

SESSION HOUSEENROLLED SUBSTITUTEVIRGINIA 22106895DACTS AMENDMENT IN THE NATURE OF AASSEMBLY SUBSTITUTE–– (ProposedCHAPTER byE theAn HouseAct Committee on Counties, Cities and Towns on March 4, 2022) (Patron Prior to Substitute––Senator Ebbin) A BILL to amend and reenact § 55.1-703 of the Code of Virginia, relating to required disclosure for buyer to beware;

R O [S 286] Approved L L Be it enacted by the General Assembly of Virginia:

That § 55.1-703.55.1-703 of the Code of Virginia is amended and reenacted as follows:

E § 55.1-703.

buyer to exercise necessary due diligence.diligeDce.

A.disclosure statement for the buyer to beware of certain matters that may affect the buyer's decision to purchase such real property.

The owner of the residential real property shall furnish to a purchaser a residential property disclosure statement for the buyer to beware of certain matters that may affect the buyer's decision to purchase such real property.

O1. improvements thereon, or with regard to any covenants and restrictions, or any conveyances of mineraly rights, as may be recorded among the land records affecting the real property or any improvements thereon, and purchasers are advised to exercise whatever due diligence a particular purchaser deems necessary, including obtaining a home inspection, as defined in § 54.1-500, a mold assessment cSnducted by a business that follows the guidelines provided by the U.S.

EnvironmentalThe Protectionowner Agency,makes andno arepresentations residentialor buildingwarranties energyas analysis,to asthe definedcondition inof §the 54.1-1144,real inproperty accordanceor any improvements thereon, or with termsregard to any covenants and cEnditionsrestrictions, suchor contract;ainedany inconveyances of mineral rights, as may be recorded among the realland estaterecords purchaseaffecting contract,the butreal inproperty or any eventimprovemenBs priorthereon, toand settlementpurchasers pursuantare advised to 2.exercise whatever due diligence a particular purchaser d8ems by a business that follows the guidelines provided by the U.S.

TheEnvironmental ownerProtection makesAgency,Eand noaed representationsresidential withbuilding respectenergy toanalysis, anyas mattersdefined thatin may§ pertain54.1-1144, to parcels adjacent to the subject parcel, including zoning classification or permitted uses of adjacent pSrcels, and purchasers are advised to exercise whatever due diligence a particular purchaser deems necessary with respect to adjacent parcels in accordance with terms and conditions as may be contained in the real estate purchase contract, but in any event prior to settlement pursuant to such contract;

B2. historic district ordinance affect the property, and purchasers are advised to exercise whatever duey diligence a particular purchaser deems necessary with respect to any historic district designated by the locality pursuant to § 15.2-2306, including review of (i) any local ordinance creating such district, (ii) any official map adopted by the locality depicting historic districts, and (iii) a survey of thI property, and (iv) any materials available from the locality that explain (a) any requirements to alter, reconstruct, :

36The renovate,owner restore,makes orno demolishrepresentations buildingswith orrespect signsto inany thematters localthat historicmay districtpertain andto (b)parcels adjacent to the neTessitysubject ofparcel, anyincluding 38zoning historicclassification district,or inpermitted accordanceuses withof termsadjacent parcels, and conditionspurchasers asare mayadvised beto containedexercise inwhatever thedue realdiligence estatea purchaseparticular 39purchaser contract,deems butnecessary with respect to adjacent parcels in anyaccordance eventwith priorterms toand settlementconditions pursuantas tomay suchbe contract;contained in the real est3.

40The owner makes no representations to any matters that pertain to whether the provisions of any historic district ordinance affect the property, and purchasers are advised to exercise whatever due diligence a particular purchaser deems necessary with respect to any historic district designated by the locality pursuant to § 15.2-2306, including review of (i) any local ordinance creating such district, (ii) any official map adopted by the locality depicting historic districts, and (iii) a survey of the property, and (iv) any materials available from the locality that explain (a) any requirements to alter, reconstruct, renovate, restore, or demolish buildings or signs in the local historic district and (b) the necessity of any local review board or governing body approvals prior to doing any work on a property located in a local contract, but in any event prior to settlement pursuant to such contract;ained in the real estate purchase 4.

The owner makes no representations with respect to whether the property contains any resource protection areas established in an ordinance implementing the Chesapeake Bay Preservation Act E (§ 62.1-44.15:67 et seq.) adopted by the locality where the property is located pursuant to § 62.1-44.15:74, and purchasers are advised to exercise whatever due diligence a particular purchaser deems necessary to determine whether the provisions of any such ordinance affect the property, including review of any official map adopted by the locality depicting resource protection areas, in accordance with terms and conditions as may be contained in the real estate purchase contract, but in anyany5. event prior to settlement pursuant to such contract;

5.The owner makes no representations with respect to information on any sexual offenders registered under Chapter 23 (§ 19.2-387 et seq.) of Title 19.2, and purchasers are advised to exercise whatever due diligence they deem necessary with respect to such information, in accordance with terms and conditions as may be contained in the real estate purchase contract, but in any event prior to settlement pursuant to such contract;

The6. owner makes no representations with respect to information on any sexual offenders registered under Chapter 23 (§ 19.2-387 et seq.) of Title 19.2, and purchasers are advised to exercise whaSever due diligence they deem necessary with respect to such information, in accordance with terms and co2ditions as may be contained in the real estate purchase contract, but in any event prior to settlement 6ursuant to suc6.

The owner makes no representations with respect to whether the property is within a dam b1eakbreak inundation zone.

Such disclosure statement shall advise purchasers to exercise whatever due diligence they deem necessary with respect to whether the property resides within a dam break inundation zone, includinginc7. a review of any map adopted by the locality depicting dam break inundation zones;

7.The owner makes no representations with respect to the presence of any wastewater system, including the type or size of the wastewater system or associated maintenance responsibilities related to of 3 the wastewater system, located on the property, and purchasers are advised to exercise whatever due diligence they deem necessary to determine the presence of any wastewater system on the property and the costs associated with maintaining, repairing, or inspecting any wastewater system, including any costs or requirements related to the pump-out of septic tanks, in accordance with terms and conditions as may be contained in the real estate purchase contract, but in any event prior to settlement pursuant to such contract;

The owner makes no representations with respect to the presence of any wastewater system, including the type or size of the wastewater system or associated maintenance responsibilities related to the wastewater system, located on the property, and purchasers are advised to exercise whatever due SB286H1 2 of 3 diligence they deem necessary to determine the presence of any wastewater system on the property and the costs associated with maintaining, repairing, or inspecting any wastewater system, including any costs or requirements related to the pump-out of septic tanks, in accordance with terms and conditions as may be contained in the real estate purchase contract, but in any event prior to settlement pursuant to such contract;

The owner makes no representation with respect to the condition or regulatory status of any impounding structure or dam on the property or under the ownership of the common interest community of 3 that the owner of the property is required to join, and purchasers are advised to exercise whatever due diligence a particular purchaser deems necessary to determine the condition, regulatory status,status,Ecost cost of of 3 required maintenance and operation, or other relevant information pertaining to the impounding structure or dam, including contacting the Department of Conservation and Recreation or a licensed professionalprofessionalure engineer.

C.

The residential property disclosure statement shall be delivered in accordance with § 55.1-709.

Such9.Ouch form shall be substantially as follows:

formL shallFlood beRisk substantiallyInformation asForm follows:with information regarding flood risk.

FloodThis Risk Information Form The purpose of this information form isdoes tonot providedetermine propertywhether ownersa andpropertys potential property owners owner will be required to purchase a flood insurance policy.

That determination is made by the lenderEender providing a loan for the property at the lender's discretion.

Mortgage lenders are mandated under the Flood Disaster Protection Act of 1973 and the National Flood Insurance Reform Act of 1994 to require the purchase of flood insurance by property owners who improvementacquire ofloans land,from facilities,federally orregulated, structuressupervised, located within or toinsured befinancial locatedinstitutions withinfor athe Specialacquisition Floodtion or Hazard Area.

A Special Flood Hazard Area (SFHA) is a high-risk area defined as any land that wouldwouldood be inundated by a flood, also known as a base flood, having a one percent chance of occurring in a given year.

The lender reviews the current National Flood Insurance Program (NFIP) maps for theOthe community in which the property is located to determine its location relative to the published SFHA and completes the Standard Flood Hazard Determination Form (SFHDF), created by the Federal EmergencUFHAEmergenc2 and Management Agency (FEMA).

If the lender determines that the structure is indeed located within a6 SFHAwill andbe therequired communityas is participating in the NFIP, the borrower is then notified that flood iSsurance whenever a loancondition isof soldreceiving on the secondaryloan. loan market or when the lender completes a routine review ofd its mortgage portfolio.

EA Propertiessimilar thatreview and notification are notcompletede locatedwhenever ina loan is sold on the secondary loan market or when the lender completes a SFHAroutine canreview stillof flood.its mortgage portfolio.

Properties that are not located in a SFHA can still flood.

It is prudent to consider purchasing flood insurance even when flood preferredinsurance riskis floodnot insurancerequired policy.by a lender.

PropertyProperties ownersnot andlocated buyersin area encouragedSFHA tomay consultbe witheligible theirfor insurancea agentlow-cost aboutpreferred risk flood insurance.insurance policy.

UProperty Whatowners and buyers are encouraged to consult with their insWhat is a flood? A flood is a general and temporary condition of partial or complete inundation of two or more acres of normally dry land area or of two or more properties, at least one of which is the policyholder's property, from (i) overflow of inland or tidal waters, (ii) unusual and rapid accumulation or runoff of surface waters from any source, (iii) mudflow, or (iv) collapse or subsidence of land alongnalong the shore of a lake or similar body of water as a result of erosion or undermining caused by waves or currents of water exceeding anticipated cyclical levels that result in a flood.

Idue FEMA is required to updateperiodic Floodmap Mapsupdates. every five years.

FloodTo zonesdetermine forwhat thisflood zone or zones a property mayis changelocated in a buyer can visit the website for FEMA's National Flood Insurance Program or the Virginia Department ofTyerof Conservation and Recreation's Flood Risk Information System website.

U T E S H 1