What is spds in real estate?

What is spds in real estate?


SPDS, or Seller’s Property Disclosure Statement, is a crucial document in the real estate industry. It plays a significant role in providing transparency and protecting the interests of both buyers and sellers. In this article, we will dive deeper into what SPDS is, its purpose, and how it impacts real estate transactions.

What is SPDS?

Definition: SPDS is a legal document that sellers are required to provide to potential buyers when selling a property. It is a comprehensive disclosure statement that outlines the condition and any known issues with the property. The purpose of SPDS is to inform buyers about the property’s condition, allowing them to make an informed decision about the purchase.

Contents of SPDS

Property Details: The SPDS typically begins with basic information about the property, such as the address, legal description, and the seller’s contact information.

Property History: This section provides details about the property’s history, including any renovations, repairs, or additions made by the seller. It may also include information about any insurance claims, property tax assessments, or zoning changes.

Material Defects: Sellers are required to disclose any known material defects in the property. Material defects are issues that could significantly affect the property’s value or pose a risk to the occupants. This may include structural problems, water damage, pest infestations, or issues with the electrical, plumbing, or HVAC systems.

Environmental Hazards: SPDS also covers potential environmental hazards that may affect the property, such as the presence of lead-based paint, asbestos, radon gas, or underground storage tanks.

Legal Issues: Sellers must disclose any pending legal issues related to the property, such as ongoing lawsuits, property liens, or violations of local building codes.

Importance of SPDS

SPDS is crucial for both buyers and sellers in a real estate transaction. For buyers, it provides essential information about the property’s condition, allowing them to assess any potential risks or costs associated with the purchase. It helps buyers make an informed decision and negotiate the terms of the sale.

For sellers, SPDS serves as a legal protection. By providing a comprehensive disclosure, sellers minimize the risk of future lawsuits or disputes arising from undisclosed issues. It demonstrates transparency and builds trust with potential buyers.

Implications for Real Estate Transactions

SPDS has a significant impact on real estate transactions. Once the buyer receives the SPDS, they have the opportunity to review it carefully and ask questions or request further inspections if needed. If the buyer discovers any undisclosed issues or feels uncomfortable with the property’s condition, they may choose to renegotiate the terms of the sale or even withdraw their offer.

In some cases, the SPDS may uncover significant issues that the buyer was unaware of, leading to a renegotiation of the purchase price or repairs to be made before closing the deal. The SPDS can also influence the buyer’s decision to proceed with the purchase or look for other properties.


In conclusion, SPDS plays a vital role in real estate transactions by providing transparency and protecting the interests of both buyers and sellers. It ensures that buyers have access to essential information about the property’s condition and any known issues. For sellers, it minimizes the risk of future disputes and demonstrates their commitment to transparency. SPDS is a valuable tool that promotes trust and facilitates informed decision-making in the real estate market.


– National Association of Realtors: nar.realtor
– Arizona Association of Realtors: aaronline.com
– California Association of Realtors: car.org