Introducing 2017 Wis. Act 338

My next few posts will discuss 2017 Wis. Act 338.  I agree with the Wisconsin REALTORS Association that this new law represents an "extreme makeover" of the condition reports used in Wisconsin real estate transactions.  The intent of this law is to make real estate condition reports more user-friendly and less confusing.  While these new forms will take some getting used to, I generally agree that the new real estate condition reports are an improvement.

While the condition reports that sellers of residential real estate and vacant land must complete have substantially changed, it is important to recognize that the scope of Chapter 709 has not.  Wis. Stat. § 709.01 (when read in conjunction with Wis. Stat. § 709.02) still requires sellers of residential real estate or vacant land to furnish a real estate condition report unless they have never occupied the property and are either a personal representative of an estate, a trustee of a trust, a conservator, or a fiduciary appointed by a court.  If the property is owned by an estate, the personal representative still must furnish a condition report unless he or she has never lived in the property (even as a child).  If the sellers have set up a revocable trust or family trust for estate planning purposes and transferred ownership of the property to that trust (as many couples do), they still must furnish a condition report.  Finally, limited liability companies that purchase foreclosed or otherwise distressed properties in order to fix them up and sell them ("flippers") still must furnish a real estate condition report even if they have never occupied the property because § 709.01(2) does not contain an exception for LLCs or their members.  Act 338 did not change the scope of Chapter 709 at all.