3 Most Important California For Sale By Owner Vacant Land Forms

What California real estate forms should I use?

We recommend that most FSBO sellers use the California Association of Realtors (CAR) forms. CAR creates the contracts and forms that real estate brokers are required to use. Those same association approved contracts and forms are available to the public. Unfortunately, in California, they are not free.

Still, there are a number of benefits to using these template forms. There are many forms available, covering the most common real estate transactions. The CAR forms are also widely used and understood by others in the industry. The forms are also balanced between the rights of buyer and seller.

• Cover most common situations
• Protect both the buyer and the seller
• Understood by the real estate industry

However, the forms don't address every potential situation when selling a California property. If your sale will have unique issues, you may want to hire a real estate attorney to help draft the documents.

What are the main FSBO real estate forms?

The California Association of Realtors has dozens of contracts and forms available. These forms are available for download in PDF format from the CAR Business Products website even if you’re not a realtor. Which ones do you need? For FSBO sellers, the most important documents are the sales contract and disclosure documents. You’ll also need a deed which we discuss in detail below.

1. California Vacant Land Purchase Agreement

A purchase agreement is a legal document that outlines the rights and responsibilities of both parties involved in the transaction. It protects both buyers and sellers by clearly defining the terms of the sale. It helps to ensure all parties clearly understand their obligations, eliminating potential disputes or misunderstandings.

The California Association of Realtors developed a specific contract form to use when selling land, the Vacant Land Purchase Agreement (VLPA). This form is different from the more commonly used Residential Purchase Agreement (RPA) that would be used for the typical home sale.

The VLPA is intended to remove concepts from the Residential Purchase Agreement that don’t apply to vacant land such as what appliances and fixtures convey with the property. The VLPA also covers additional topics not needed in residential sales. Some examples include treatment of environmentally hazardous substances and manufactured homes.

For more discussion of the Vacant Land Purchase Agreement, see our quick guide.

Note that the VLPA is a lengthy document and may be more than you need for a simple land sale. As a seller, you’re not required to use the VLPA if you’re not working with a realtor. However, the VLPA guides you through important legal topics such as disclosures that apply even if you use another contract form. The initial headache of using this contract form may be worth it knowing you’ve covered everything.

2. Disclosure documents

Vacant land is exempt from the transfer disclosure statement (TDS) that the California Civil Code requires for sales of residential property. However, the seller is still required to disclose any and all known facts that materially affect the value or desirability of the property. The disclosure requirement applies even if the buyer doesn’t ask. The duty to disclose applies even when selling land as-is.

The California Vacant Land Purchase Agreement (VLPA) has several seller disclosures built into the contract. Essentially, failure to disclose any of the listed conditions would be a breach of contract. These disclosures include the following, amongst others:

• Environmental hazards such as flood hazard area, fire hazard zone, or earthquake fault zone
• Any lawsuits by or against the seller involving the property
• Deed restrictions, easements, and encroachments
• Environmental hazards such as fuel or chemical storage tanks, or contaminated soil or water
• Soil problems such as sliding, flooding, drainage, grading, or other problems

The VLPA also calls for the Vacant Land Questionnaire (VLQ) to be completed. The VLQ is an extensive checklist that overlaps with some of the disclosures in the VLPA. The VLQ goes further, however, covering utilities, diseases or infestation affecting plants on the property, title, ownership, and legal claims, and many other topics.

3. Deeds

There are two main types of deeds used in California, the grant deed and the quit claim deed. There are other variations, but they are considered variations of the two main types of deed.

• Grant deed. The grant deed is the most common type of deed used to transfer property in California. The Vacant Land Purchase Agreement discussed above calls for a grant deed to be issued to the buyer. With a grant deed, the seller promises that they own the property and that there are no hidden liens associated with the property. 
• Quitclaim deed. With a quitclaim deed, the grantor transfers their own rights to the new owner, but doesn’t promise anything else. The quitclaim deed is frequently used in inheritance or divorce situations.

You can download free versions of a grant deed and quitclaim deed from the Sacramento County Public Law Library.

If you decide to prepare the deed yourself, you should be aware that under California law certain rules apply for a deed to be considered valid:

1. Written document. The deed must be in writing to be effective.
2. Parties described. The deed must name the people involved in the sale.
3. Competent and capable. The parties must be competent to convey and capable of receiving the property.
4. Property description. The property must be described appropriately.
5. Granting clause. There must be clear language of conveyance, such as “I hereby grant.”
6. Signature. The seller (or grantor) of the property must sign the deed.
7. Delivery to and acceptance by buyer. In practice, delivery and acceptance is assumed when a deed is recorded in the county clerk's records.

Frequently asked questions

How long are you liable after selling a property in California?

Under California’s disclosure laws, buyers can pursue compensation for damages related to a seller’s non-disclosure of an issue. Buyers have three years after discovering the issue to pursue legal action.

Does Prop 13 apply to vacant land?

Yes, Prop 13 applies to all properties in the state, including vacant land. California's Proposition 13 is a law that limits property tax increases. Prop 13 makes it easier to hold onto land because the property will be taxed based on the original purchase price, not its current value.

How is a land sale reported to the IRS?

IRS Form 1099-S is used to report the sale or exchange of real estate. Normally, a title company or attorney will prepare this for you if you’re using one. If not, and if there is also not a mortgage lender or broker involved, then the buyer is responsible for filing Form 1099-S.

Conclusion - California contracts and forms

It’s important for FSBO sellers to know about the California Association of Realtors contracts and forms. They provide comprehensive templates for the most common real estate transactions that are balanced between the rights of buyers and sellers. Of course, not every for sale by owner transaction fits neatly into a template. In some cases you may choose to consult an attorney to draft or review a contract for your particular situation.

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‍Please consult your financial advisor, accountant, real estate attorney, or tax specialist. This article is for informational purposes and is not tax or legal advice.