Prior to a real estate commissioner granting a public report, a landowner must meet the minimum requirements of the Subdivided Lands Law. The subdivision public statement is a state that discloses disclosures that grants the right for the property to be the sold or leased of any individual lot, parcels, or units within a subdivision. Before a landowner can sell the property, the public report must be created to allow prospective buyers the ability to review the specifics of the property.
The minimum requirements include the need to fill out and submit an application indicating the specifics of the property. The real estate commissioner will then review the application and approve the request for a public report assuming everything is filled out accurately. In the event the real estate commissioner has created the public report and changes have been made to the property during that period, the landowner must inform the real estate commissioner of the changes. Changes include adjustments to the land, deed restrictions, drilling, and other potential alterations of the land.
Generally, the most difficult and time consuming of all the types of public records are common interest subdivisions. This is because common interest subdivisions affect many people and in turn the review process is typically very lengthy.
A sale of subdivided property without a public report cannot take place, which means the real estate commissioner must issue a public report prior to the sale of land. This protects consumers from fraud and assists them in making better real estate decisions.
Preliminary Subdivision Public Report
A preliminary subdivision public report — otherwise known as a “pink slip” or “pink report” — gives a seller the ability to advertise and to collect deposits for the sale of subdivided land. This allows a seller to enter into a formal agreement with a buyer before a final subdivision public report is issued.
Deposits must be held in escrow. Funds cannot be released by escrow to the seller until the final public report has been provided to the buyer.
A preliminary subdivision public report is only valid for six months. The seller can renew for an additional six months if the Planning Department believes the conditions of the subdivision’s approval can be met within that time frame.
A seller is not required to obtain a “pink slip” in order to receive a final subdivision public report.
Final Subdivision Public Report
A final subdivision public report — also known as a “white slip” or “white report” — authorizes a seller/developer to sell or lease subdivided land.
The purpose of the final public report is to provide vital information to the buyer of subdivided land and to protect them from inaccurate information from the seller and/or the seller’s agent. It includes guidelines for the subdivision of the property, including all fees associated with developing the property and any potential costs and problems that may arise during the development process.
Among the specific information included are:
Current liens and encumbrances
Soil and engineering reports
Location of utility lines and pipes
Location of drainage and sewers
Gas, electricity, and water information
Right of ways
Size of maximum unit
Identity of owner
Risks and restrictions
Homeowners association costs
A final subdivision public report is issued after a seller/developer has met all the required conditions. A buyer has the right to have any deposits refunded if the final report does not reflect the agreed upon terms. Otherwise, a buyer of subdivided land must sign a receipt indicating they have been provided the public report and that they are informed of the information within it.
Subdivisions with less than five units, and commercial and industry subdivisions, are exempt from obtaining a final public report.