What is a Natural Hazard Zone Disclosure (NHD)?

The state of California requires almost all sellers to disclose natural hazard zones to buyers. Information about the natural hazards are what make up a natural hazard disclosure (NHD). Sellers, or their real estate agents, order these NHD reports from third party companies that allocate California Natural Hazard Data on a report.

There is a standard NHD format that is set by the state. However, NHD companies, like FastNHD.com, add additional disclosure info into the report. This offers futher protection to the seller. We are often asked at is the state requirements for an NHD. Below you will find what the state of California requires.

Natural Hazards Disclosure

Unless the transfer of the property is subject to an exemption from this disclosure, the seller or the seller’s agent for this purpose must make appropriate disclosures if the property is in one or more of the following zones or areas:

• Zone A or Zone V (special flood hazard area) as designated by the Federal Emergency Management Agency. The seller’s agent, or the seller, if acting without an agent, must make this disclosure if:

o The seller, or the seller’s agent has actual knowledge that the property is in a special flood hazard area; or

o The local jurisdiction has compiled a list of parcels that are in a special flood hazard area and has posted at the offices of the county recorder, county assessor, and county planning agency a notice that identifies the location of the parcel list.

(CAL. GOV’T § 8589.3)

• An area of potential flooding shown on a map as an area which will be inundated if a dam fails. The seller’s agent, or the seller if acting without an agent, must make this disclosure if:

o The seller, or the seller’s agent, has actual knowledge that the property is within a delineated inundation area; or

o The local jurisdiction has compiled a list of parcels that are in the inundation area and has posted at the offices of the county recorder, county assessor, and county planning agency a notice that identifies the location of the list.

(CAL. GOV’T § 8589.4)

• A designated very high fire hazard severity zone. The seller and the seller’s agent must make this disclosure if:

o The seller, or the seller’s agent, has actual knowledge that the property is in a designated very high fire hazard severity zone; or

o The local agency has received a map of such properties which includes the seller’s property and has posted at the offices of the county recorder, county assessor, and county planning agency a notice that identifies the location of the map and any changes to it.*

(CAL. GOV’T § 51183.5)

• A designated wildland area (“state responsibility area”) that may contain substantial forest fire risks and hazards. The seller and the seller’s agent must make this disclosure if:

o the seller or the seller’s agent has actual knowledge that the property is in a designated wildland fire zone; or

o the city or county has received a map of such properties which includes the seller’s property and has posted at the offices of the county recorder, county assessor, and county planning agency a notice that identifies the location of the map and any changes to it.*

(CAL. PUB. RES. § 4136)

• An earthquake fault zone. These zones are over earthquake faults and are usually about one quarter mile in width. The seller’s agent, or the seller if acting without an agent, must disclose that the property is in one of these zones if:

o the seller, or the seller’s agent, has actual knowledge that the property is within a delineated earthquake fault zone; or

(CAL. PUB. RES. § 2621.9)

• A seismic hazard zone. In an earthquake, properties in one of these zones may be subject to strong ground shaking, soil liquefaction, or landslide. The seller’s agent, or the seller if acting without an agent, must disclose that the property is in one of these zones if:

o the seller, or the seller’s agent, has actual knowledge that the property is within a delineated seismic hazard zone; or

(CAL. PUB. RES. § 2694)

* NOTE: If, when looking at the map, a reasonable person cannot tell with certainty whether the property is in the zone, the seller or seller’s agent must mark “YES” on the disclosure form, unless there can be attached to the form an expert’s report, prepared pursuant to Civil Code Section 1102.4(c), indicating that the property is not located in the zone.

These disclosures must be made on the Natural Hazard Disclosure Statement (NHDS) or on the Local Option Real Estate Transfer Disclosure Statement (Local Option Disclosure), if the local jurisdiction has mandated use of a Local Option Disclosure for the same disclosure purposes and the information and warnings are substantially the same as on the NHDS.

The seller or his or her agent may elect to use the services of a third party consultant to complete the NHDS in lieu of completing the NHDS themselves. The use of a third party consultant does not relieve the seller or his/her agent from the obligation to deliver NHDS to the buyer.

(CAL CIV. §§ 1103, 1103.1, 1103.2, 1103.3, 1103.4)

The following is the required format for the NHDS:

NATURAL HAZARD DISCLOSURE STATEMENT

This statement applies to the following property:______________________

The transferor and his or her agent(s) or a third-party consultant disclose the following information with the knowledge that even though this is not a warranty, prospective transferees may rely on this information in deciding whether and on what terms to purchase the subject property. Transferor hereby authorizes any agent(s) representing any principal(s) in this action to provide a copy of this statement to any person or entity in connection with any actual or anticipated sale of the property.

The following are representations made by the transferor and his or her agent(s) based on their knowledge and maps drawn by the state and federal governments. This information is a disclosure and is not intended to be part of any contract between the transferee and transferor.

THIS REAL PROPERTY LIES WITHIN THE FOLLOWING HAZARDOUS AREA(S):

A SPECIAL FLOOD HAZARD AREA (Any type Zone “A” or “V”) designated by the Federal Emergency Management Agency. Yes _____

No _____

Do not know and information not available from local jurisdiction _________

AN AREA OF POTENTIAL FLOODING shown on a dam failure inundation map pursuant to Section 8589.5 of the Government Code. Yes _____

No _____

Do not know and information not available from local jurisdiction _________

A VERY HIGH FIRE HAZARD SEVERITY ZONE pursuant to Section 51178 or 51179 of the Government Code. The owner of this property is subject to the maintenance requirements of Section 51182 of the Government Code. Yes _____

No _____

A WILDLAND AREA THAT MAY CONTAIN SUBSTANTIAL FOREST FIRE RISKS AND HAZARDS pursuant to Section 4125 of the Public Resources Code. The owner of this property is subject to the maintenance requirements of Section 4291 of the Public Resources Code.

Additionally, it is not the state’s responsibility to provide fire protection services to any building or structure located within the wildlands unless the Department of Forestry and Fire Protection has entered into a cooperative agreement with a local agency for those purposes pursuant to Section 4142 of the Public Resources Code. Yes _____

No _____

AN EARTHQUAKE FAULT ZONE pursuant to Section 2622 of the Public Resources Code. Yes _____

No _____

A SEISMIC HAZARD ZONE pursuant to Section 2696 of the Public Resources Code. Yes (Landslide Zone) _____

No _____

Yes (Liquefaction Zone) _____

Map not yet released by state _______

THESE HAZARDS MAY LIMIT YOUR ABILITY TO DEVELOP THE REAL PROPERTY, TO OBTAIN INSURANCE, OR TO RECEIVE ASSISTANCE AFTER A DISASTER.

THE MAPS ON WHICH THESE DISCLOSURES ARE BASED ESTIMATE WHERE NATURAL HAZARDS EXIST. THEY ARE NOT DEFINITIVE INDICATORS OF WHETHER OR NOT A PROPERTY WILL BE AFFECTED BY A NATURAL DISASTER. TRANSFEREE(S) AND TRANSFEROR(S) MAY WISH TO OBTAIN PROFESSIONAL ADVICE REGARDING THOSE HAZARDS AND OTHER HAZARDS THAT MAY AFFECT THE PROPERTY.

Signature of Transferor(s)_____________________ Date__________________

Agent(s)___________________________________ Date__________________

Check only one of the following:

! Transferor(s) and their agent(s) represent that the information herein is true and correct to the best of their knowledge as of the date signed by the transferor(s) and agent(s).

! Transferor(s) and their agent(s) acknowledge that they have exercised good faith in the selection of a third-party report provider as required in Civil Code Section 1103.7, and that the representations made in this Natural Hazard Disclosure Statement are based upon information provided by the independent third-party disclosure provider as a substituted disclosure pursuant to Civil Code Section 1103.4.

Neither transferor(s) nor their agent(s) (1) has independently verified the information contained in this statement and report or (2) is personally aware of any errors or inaccuracies in the information contained on the statement. This statement was prepared by the provider below:

Third-Party Disclosure Provider(s)_________________________ Date_________________

Transferee represents that he or she has read and understands this document. Pursuant to Civil Code Section 1103.8, the representations made in this Natural Hazard Disclosure Statement do not constitute all of the transferor’s or agent’s disclosure obligations in this transaction.

Signature of Transferee(s)______________________ Date_________________

NOTE: Although the form for the natural hazard disclosures is mandated only for properties described on page 1 of this booklet, the appropriate disclosure must be made in some manner when any real property located in one of the zones is to be sold or transferred.

(CAL. CIV. § 1103.2)

The Natural Hazards Disclosure Act, under Sec. 1103 of the California Civil Code, states that real estate seller and brokers are legally required to disclose if the property being sold lies within one or more state or locally mapped hazard areas. The law specifies that the six (6) required hazards be disclosed on a statutory form called the Natural Hazard Disclosure Statement (NHDS).

Required Risks Include:

1. A Special Flood Hazard Area

2. Dam Inundation

3. Very High Fire

4. Wildland fire

5. Earthquake Fault Zone

6. A Seismic hazard

The following supplemental hazards are commonly reported as well:

a. Radon Gas exposure

b. Airport influence area

c. Megan’s Law disclosures

d. Military ordnance

The state of California has a standardized reporting format for the seller and their agent to comply with the law, as it is their responsibility to disclose. The seller and their agent are allowed to seek out a ‘third party’ (disclosure company, licensed engineer, land surveyor, geologist, or expert in natural hazard discovery) to prepare this report for them. Seller, as transferor, Seller’s Agent(s), and Buyer, as transferee are to sign one copy of the Natural Hazard Disclosure Report prior to the close of escrow.

It is illegal for agents to require the seller to use a particular natural hazard disclosure company or to give the impression that the seller may not choose. If the report from a disclosure company is selected and that company is related or affiliated with the agent or broker, disclosure of this relationship must be made to the seller. Once the disclosure is made the seller may continue with that report or choose a report from another disclosure company. California law protects the seller’s right to freely choose, for the sake of quality, service and cost.

Real estate agents and broker are forbidden to receive monetary compensation (referral fees, ‘kick-backs‘) or excessive gifts from vendors or affiliates, including but not limited to disclosure companies.

About NHDs

What is a Natural Hazard Zone Disclosure (NHD)?

Natural Hazards Disclosure

NATURAL HAZARD DISCLOSURE STATEMENT