Buying property in New York City is a major investment. Whether you are purchasing a co-op, condo, brownstone, or commercial space, you expect transparency about the condition of the property. But what happens if a seller fails to disclose known defects? Understanding your rights under New York law is essential if you discover serious issues after closing.

At Law Offices of Benjamin B. Neschis, P.C., we provide legal assistance to the New York City public in complex real estate matters, including disputes involving undisclosed property defects.

New York’s Property Disclosure Requirements

New York law requires sellers of residential real property (1–4 family homes) to provide a Property Condition Disclosure Statement (PCDS). This document asks the seller to answer questions about the property’s condition, including:

• Structural issues
• Roof leaks
• Water damage or flooding
• Plumbing or electrical problems
• Environmental hazards
• Known legal disputes affecting the property

However, New York is somewhat unique. Instead of completing the disclosure form, sellers may choose to give the buyer a $500 credit at closing. In practice, many sellers opt to pay this credit rather than provide detailed disclosures.

Even when a disclosure form is not provided, sellers cannot actively conceal known defects or commit fraud.

What Qualifies as a Property Defect?

A property defect typically involves a condition that:

• Affects the value of the property
• Impacts safety or habitability
• Would influence a buyer’s decision to purchase

Common examples include:

• Foundation cracks or structural instability
• Mold or water intrusion
• Termite or pest damage
• Hidden plumbing leaks
• Illegal renovations or building code violations

Minor cosmetic issues usually do not qualify as actionable defects. The key factor is whether the seller knew about the issue and failed to disclose it.

Fraud and Active Concealment in New York

Because sellers can avoid completing the disclosure form by offering a $500 credit, many buyer claims rely on proving fraud or active concealment.

Active concealment occurs when a seller intentionally hides a defect. Examples may include:

• Painting over water damage to mask leaks
• Covering foundation cracks
• Temporarily fixing a recurring issue to pass inspection

To succeed in a fraud claim, a buyer generally must prove:

1. The seller knew about the defect
2. The seller intentionally concealed or misrepresented the issue
3. The buyer reasonably relied on the seller’s actions
4. The buyer suffered financial damages as a result

Fraud claims can be complex and require substantial evidence.

What Are Your Legal Options?

If you discover undisclosed defects after closing, you may have several legal options depending on the circumstances:

1. Filing a Lawsuit for Fraud or Misrepresentation
You may seek damages for repair costs, diminished property value, and other financial losses.

2. Rescission of the Sale
In rare and severe cases, a court may unwind the transaction. This is more likely when fraud is significant and material.

3. Claims Against Other Parties
In some situations, real estate agents, contractors, or other professionals may also bear responsibility if they knowingly participated in misrepresentation.

Timing is critical. New York has statutes of limitations that limit how long you have to bring a claim.

The Importance of Documentation

If you suspect nondisclosure, gather:

• The purchase agreement
• Inspection reports
• The Property Condition Disclosure Statement (if provided)
• Repair estimates
• Photos and videos of the defect
• Any communication with the seller

Strong documentation can significantly impact the outcome of a dispute.

How Legal Guidance Can Help

Real estate litigation in New York City can be complex, especially when fraud must be proven. Sellers often argue that the buyer should have discovered the defect during inspection. A thorough legal analysis can determine whether you have a viable claim and what remedies may be available.

At Law Offices of Benjamin B. Neschis, P.C., we assist New York City buyers and investors in resolving real estate disputes efficiently and strategically.