US Real Estate Law Explorer
Educational information only. Not legal advice. Not affiliated with any state agency or real estate union.

California Real Estate Law

Regulator: California Department of Real Estate

Agency Relationships

  • Agents must give a written Agency Disclosure form explaining buyer, seller, and dual agency.
  • A dual agent may not disclose one party's price motivation to the other.
  • Since 2019, agents representing investor buyers must disclose that relationship to sellers.

Property Disclosures

  • Sellers must provide a Transfer Disclosure Statement (TDS) and a Natural Hazard Disclosure (NHD).
  • Required natural-hazard disclosures include flood, fire, seismic, and fault-zone (Alquist-Priolo) information.
  • Megan's Law database notice and mold, lead, and asbestos advisories are also required.

Contract Nuances

  • Most residential sales use the California Association of Realtors Residential Purchase Agreement.
  • Either buyer or seller may cancel for specific contingencies (inspection, appraisal, loan) within set timelines.
  • Escrow is handled by a neutral third party; closings do not require an attorney.

Closing & Costs

  • Closings are handled by independent escrow companies or title-company escrow desks. No attorney is required.
  • Local custom varies by region: in Northern California the buyer typically pays for the owner's title policy, while in Southern California the seller usually pays. Escrow fees are commonly split.
  • California has a documentary transfer tax (state + many counties + some cities). San Francisco and Los Angeles add the largest local transfer taxes in the US.
  • Property taxes are billed semi-annually and prorated at closing under Proposition 13's assessed-value rules.
  • Most California closings disburse funds the same day they record — confirm timing with your escrow officer.

Buyer-Agent Compensation (post-2024)

  • Since August 17, 2024, multiple-listing services (MLS) can no longer publish offers of buyer-agent compensation. Sellers may still choose to pay a buyer's agent, but it is now negotiated separately and disclosed off-MLS.
  • Buyers must sign a written representation agreement with their agent before touring a home. The agreement must state how the agent is paid and how much. Read it carefully — the fee is between you and your agent now, not automatically covered by the seller.
  • If you are buying, ask whether the seller is offering to pay your agent's commission, who else might pay it, and exactly what services are included.
  • If you are selling, you are no longer required to offer a buyer's agent commission. Your listing agent should explain the trade-offs of doing so anyway.

Tenant & Landlord Rights

  • Security deposits are regulated; landlords must return them within a set number of days after move-out.
  • Evictions require proper written notice and, in most cases, a court order.
  • Retaliation against tenants who exercise legal rights is prohibited.

Educational information only. Not legal advice. Laws change; verify with the official sources above or consult a licensed attorney.