Which statement about the condition of real property is true in the context of caveat emptor and exceptions?

• A. The seller has a general duty to disclose all information about the property.
• B. Delivery of a property condition disclosure statement is only required for one-family dwellings.
• C. The housing merchant implied warranty applies to the sale of a new home by a builder.
• D. Active concealment by the seller never triggers a duty to disclose.

Answer: (C)

Under caveat emptor, buyers take on some risk, but there are notable exceptions that protect purchasers of real property. One important exception in New York is the housing merchant implied warranty: when a builder sells a newly constructed home, the builder impliedly warrants that the home is free from latent defects in construction and workmanship. This warranty arises from the builder-buyer relationship and provides protection for hidden defects that wouldn’t be discovered by a casual inspection, making the purchase safer for a buyer of a new home.

That’s why this statement is the best answer: it accurately captures an established exception to caveat emptor by recognizing an implied warranty specifically tied to new homes sold by builders. The other statements don’t fit the standard rules. A broad duty to disclose all information about the property isn’t required under caveat emptor unless fraud or a latent defect is involved. The requirement to deliver a property condition disclosure statement isn’t universally limited to one-family dwellings. And active concealment does trigger a duty to disclose and can give rise to remedies for the buyer.