A Pink, or Preliminary Public Report, is one of the first stages in obtaining a full Public Report for a property and allows the advertising of a property for sale and allows owners to take refundable deposits for reservation. It means that while a preliminary report may be released, the DRE has not yet reviewed or offered approval of the subdivision. In fact, a preliminary public report offers no guarantee that the improvements needed will ever be completed or that the property will ever comply with DRE standards.
Laws
Under a Pink, a property can be in escrow, but not under a binding contract, which isn’t allowed at this stage. Either party can cancel during this stage and must be issued a full refund. This also means that the terms aren’t enforceable by either party, and the seller may ignore the reservation and sell to another buyer. A preliminary public report is valid for one year and can be renewed as frequently as needed. A short application is required, and the report is often issued within two weeks of submittal. To obtain a Pink, the developer must be in title or be an ‘owner in escrow’ and the project must have tentative approval.
A public report is unnecessary for the following projects:
– Any subdivisions with less than five units, whether they’re houses, lots, buildings, etc.
– Any subdivision offered by a public agency
– Industrial or commercial subdivisions
– A standard subdivision without a common area that is within the boundaries of a city with all lots to be improved
The report will disclose specific information like the applicant’s name, size and location of the subdivision, taxes, management, schools, operational and management costs, rights of way, unusual easements, if there are any, restrictions or requirements set upon the buyer, or any unusual costs that a consumer may have to incur.
