California's New Water-Conserving Plumbing Fixtures Law

[Wes Blackwell]

Starting January 1st, 2017 California is requiring "that all noncompliant plumbing fixtures in any single-family residential real property shall be replaced by the property owner with water-conserving plumbing fixtures... 

"The bill would require, on and after January 1, 2017, that a seller or transferor of single-family residential real property, multifamily residential real property, or commercial real property disclose to a purchaser or transferee, in writing, specified requirements for replacing plumbing fixtures, and whether the real property includes noncompliant plumbing. The bill would require, on and after January 1, 2017, a seller of certain residential real property to make a specified disclosure in this regard. The bill would permit an owner or the owner’s agent to enter rental property for the purpose of installing, repairing, testing, and maintaining water-conserving plumbing fixtures, as specified..." 

Read more at: https://leginfo.legislature.ca.gov/faces/billNavCl...

Just had my first transaction where this has become an issue... seller countered our offer simply to disclose that the water fixtures are non-compliant, and that section 7B2(i) and 7B2(ii) (the government compliant retrofit standards) of the residential purchase agreement are "the responsibility of the buyer as the seller will no longer have any future interest in the property."

Sooo... that brings the question, how is this going to be enforced? Primarily by the lenders? Are we really going to make installing new plumbing fixtures a part of every single transaction?! Appraisers are supposed to evaluate whether or not a toilet or faucet is water conserving? 

And what's going to be the standard going forward for who's responsibility is it to pay for it? The buyer or the seller? Let's hear some thoughts on the issue!

[Wes Blackwell]

@Lois S.

So, there was a bit of stir way back when I wrote this post, but how it's played out is that the seller is simply required to disclose whether or not the plumbing fixtures are in compliance. Most of the time on older homes they are not.

Buyers don't generally ask for them to replaced either, as most buyers simply don't care. As long as the toilet flushes and the shower flows, they're ok with it not being a water-conserving fixture.

All sales by default are "as-is" -- It's just that after the home inspection the buyers may make a "Request for Repairs" which is only supposed to include repairs they request that will cause them to walk away if not fixed. But in reality it's just a second round of negotiations where the buyer requests some things to be fixed and the seller agrees to some and disagrees with others.

It's up to your agent to help you navigate this process and decide what you should agree to repair and what not to agree to. Here's some advice as a general guideline:

3 Types of Repairs

1. Broken
2. Worn
3. Cosmetic

Broken -- Things that are broken and not in working order should generally be repaired or replaced, like a broken garbage disposal for example. If you're smart you'll fix these issues before you even list the house for sale.

Worn -- These are items that are near the useful end of their life, and whether or not they should be replaced depends on their condition. For example, if the roof only has 2 years of life left in it, it should probably be replaced as it's a $10k repair waiting to happen for the buyer, and they will take that into consideration with their offer price. But if the roof is only 10 years old, it's got plenty of life left and shouldn't be replaced.

Cosmetic -- Generally speaking, these are not agreed to. The buyer saw the house the way it was when they viewed it, so they should've addressed it up front with their offer. Sometimes if the carpet is really bad or the paint is really old, the seller will offer a credit to fix as a way to make up for it.

Hope this helps. I wouldn't worry about your plumbing fixtures, as it's highly unlikely the buyer will ask you to replace them, and a good listing agent should be able to help you overcome that request in a negotiation.