Should I Disclose Past Water Damage in California?

You are getting ready to sell your home. You look at the Transfer Disclosure Statement (TDS)—that intimidating multi-page legal document—and you pause at the question about "Water Intrusion."

You think: "Well, the roof did leak in 2019, but we fixed it. It hasn't leaked a drop since. Do I really need to bring up old news and scare off buyers?"

The short answer: Yes.

The long answer: If you don't, you are handing the buyer a lawsuit on a silver platter.

California has some of the strictest real estate disclosure laws in the country. Here is why hiding (or simply forgetting) past water damage is a massive risk, and why "over-disclosing" is the smartest move a seller can make.

The Law: California Civil Code 1102

In California, sellers are legally required to disclose any "material facts" that could affect the value or desirability of the property.

Water damage is the definition of a material fact.

Even if the issue is "fixed," the history of the issue matters. Why? Because repairs can fail. Mold can grow behind dry walls years later. If a buyer moves in and the roof leaks in the exact same spot you "fixed," and they find out you knew about it but stayed silent, you are liable.

What You Must Disclose:

• Past roof leaks (even if patched).
• Plumbing backups or burst pipes.
• Window leaks during heavy storms.
• Drainage issues in the yard / standing water.
• Any insurance claims you filed regarding water.

The "Fixed" Fallacy

Many sellers believe, "If I fixed it, it's not a defect anymore, so I don't have to list it."

This is wrong.

You are not just disclosing current defects; you are disclosing the history of the property.

The Right Way to Handle It: On the disclosure form, check "Yes" for water intrusion. Then, in the explanation section, write:

"Roof leak occurred in master bedroom in Feb 2020 due to slipped tile. Repaired by ABC Roofing in March 2020. Invoice and warranty attached. No known leaks since."

Why this is brilliant:

1. It builds trust: You look honest and transparent.
2. It proves care: You show that you maintained the home professionally.
3. It protects you: If the roof leaks again in 2026, the buyer cannot sue you for fraud. You told them about it. They bought the house knowing the history.

The Nightmare Scenario: "Concealment"

Let’s say you decide not to mention the old leak. You paint over the water stain on the ceiling and sell the house.

Six months later, we get a heavy El Niño storm. The roof leaks. The buyer calls a contractor to open up the ceiling. The contractor finds old, black mold and rotted wood behind the drywall and says, "Oh yeah, this has been leaking for years. Look, someone painted over the old stain."

Now, the buyer isn't just suing you for the cost of a new roof. They are suing you for:

• Fraud and Concealment: Which can carry punitive damages (punishment money).
• Rescission: In extreme cases, a judge can force you to buy the house back.
• Attorney Fees: You might have to pay their legal bills, which can easily exceed the cost of the repair.

Best Practices for Sellers

1. When in Doubt, Disclose

If you are asking your agent, "Do I really need to mention this?" the answer is always yes. If it’s minor, it won't kill the deal. If it’s major, you must disclose it.

2. Provide the Paperwork

Don't just say "we fixed it." Attach the receipts, the contractor's invoice, and any warranties. This turns a "scary red flag" into a "documented repair."

3. Don't Guess

If you don't know the source of an old stain, don't make one up. It is okay to write: "Stain on garage ceiling present when we bought the home in 2015. Cause unknown. Has not changed or been active during our ownership."

The Bottom Line

In California real estate, disclosure is your insurance policy.

Buyers rarely walk away because of a disclosed, repaired issue. They walk away (and sue) when they feel tricked. Tell the truth, show the receipts, and sleep soundly knowing you are protected from future liability.