Material fact

Key Takeaways

• A material fact is information weighty enough to change a reasonable buyer's decision or the property's value, and a broker who knows one has to disclose it.
• In Washington the term is defined by statute as information that substantially adversely affects the value of the property, a party's ability to perform, or the purpose of the transaction (RCW 18.86.010).
• Washington brokers must disclose existing material facts they know that are not apparent or readily ascertainable to a party (RCW 18.86.030), and they owe no duty to inspect or investigate to find them.
• In Washington a death, crime, or similar event that does not adversely affect the physical condition of or title to the property is not a material fact (RCW 18.86.010).

What It Means

A material fact is information with enough weight to change the deal. The test has two prongs: does the information move the property's value, or does it affect a party's ability to perform and close. A cracked foundation, an unrecorded Lien, an addition built without permits, a pending assessment, a failed septic system, each one hits value or hits the buyer's ability to finance and complete the purchase.

Plenty of information does not clear that bar. The neighbor's taste in yard art, the fact that the sellers are divorcing, a rumor about the street, these can interest a buyer without substantially affecting value or performance. Materiality is a threshold, not a preference.

The disclosure duty reaches what the broker knows, not what the broker could have found out. A Latent Defect the seller concealed and the broker never learned of is not something the broker failed to disclose. That is why the duty is stated as disclosing known material facts, and why it is a different thing from a duty to inspect. Related reading: Form 35 in 2026: Inspection Contingency Changes Every WA Agent Must Understand.

How It Works in Washington

In Washington, material fact is not left to judgment, it is defined by statute. RCW 18.86.010(11) defines it as information that substantially adversely affects the value of the property or a party's ability to perform its obligations in a real estate transaction, or that operates to materially impair or defeat the purpose of the transaction. RCW 18.86.030(1)(d) then requires a broker to disclose all existing material facts known by the broker and not apparent or readily ascertainable to a party.

The same chapter draws the line on the other side. RCW 18.86.030(2) provides that, unless otherwise agreed, a broker owes no duty to conduct an independent inspection of the property, no duty to investigate either party's financial condition, and no duty to independently verify the accuracy or completeness of a statement made by either party. RCW 18.86.010(11) also carves stigma out of the definition, so a murder, suicide or other death, a sex crime or other violent crime, a burglary, illegal drug activity, gang-related activity, or political or religious activity at the property or a neighboring property is not a material fact when it does not adversely affect the physical condition of or title to the property. That is why a Stigmatized Property question is handled differently from a condition question.

The seller has a parallel duty of their own. RCW 64.06.020 requires a seller of improved residential real property to deliver a completed seller disclosure statement, the form Washington practitioners call Form 17, and states that it is for disclosure only and is not a warranty or part of the written agreement. RCW 64.06.021 adds that the sex offender notice in that statement creates no legal duty for the seller or any real estate licensee to investigate or to report on registered sex offenders in the area.

Example

Dana lists her Everett house at $615,000. At the listing appointment she tells her broker, Kevin, that the basement took on water twice in the last three winters and that a $9,800 drainage repair did not stop it. She asks him to leave that off the seller disclosure statement.

Kevin cannot. Water intrusion of that kind substantially affects value, it is not apparent to a buyer walking through in August, and Kevin now knows about it, so RCW 18.86.030(1)(d) requires him to disclose it. Dana's refusal does not transfer to him, and marketing the house as sound after that conversation would bring him within the false statements ground in RCW 18.85.361(2).

In the same conversation Dana mentions that the previous owner died of a heart attack in the kitchen. Under RCW 18.86.010(11) that is not a material fact in Washington, because it does not adversely affect the physical condition of the house or the title, so Kevin has no duty to raise it.

Common Mistakes and Exam Traps

• The duty is to disclose known material facts, not to go find them. Washington gives a broker no duty to conduct an independent inspection or to verify a party's statements (RCW 18.86.030).
• In Washington a murder, suicide, or other death at the property is not a material fact, so stigma questions are not handled like condition questions (RCW 18.86.010).
• The seller's disclosure statement does not absorb the broker's duty. A broker who knows something the seller left off the form still has to disclose it.
• Material means the information substantially affects value, a party's performance, or the purpose of the transaction, not merely that a buyer would find it interesting.