Material Facts Matter: What NCREC and the NAR Code of Ethics Expect from You

In real estate, what you disclose—and when—can protect your license, your reputation, and your client’s best interests. Disclosing material facts isn’t optional. It’s a legal requirement in North Carolina and an ethical mandate under the National Association of REALTORS® (NAR) Code of Ethics.

Let’s break down what you need to know to stay compliant, professional, and in full alignment with the standards of our industry.

What Is a Material Fact?

A material fact is any fact that could affect a party’s decision to buy, sell, lease, or finance a property. According to the North Carolina Real Estate Commission (NCREC), material facts include:

• Facts about the property itself (e.g., structural issues, roof damage, previous fire/flood)

• Facts relating directly to the transaction (e.g., zoning changes, pending foreclosures)

• Facts about the ability of the parties to complete the transaction

• Facts known to be of special importance to a party (if the agent has actual knowledge)

The keyword? Anything that could influence a decision. If it’s relevant, it’s material—and it must be disclosed.

NCREC Expectations for Disclosure

In North Carolina:

• Brokers must disclose material facts to all parties in a transaction—whether they represent them or not.

• This duty applies to both buyer’s agents and listing agents, and even unrepresented parties.

• Disclosure must be prompt and proactive, not just upon request.

• No “as-is” clause or waiver relieves a broker from their duty to disclose known material facts.

What the NAR Code of Ethics Says

If you're a REALTOR®, you’re also held to the NAR Code of Ethics, which reinforces and expands upon the obligation to disclose:

Article 2: REALTORS® shall avoid exaggeration, misrepresentation, or concealment of pertinent facts relating to the property or the transaction.

Standard of Practice 2-1: REALTORS® must disclose adverse material facts that they know about, even if they’re not obligated by law.

Article 1: REALTORS® protect and promote the interests of their client, but remain obligated to treat all parties honestly.

Translation? It’s not just about what’s legal—it’s about what’s ethical.

What NOT to Do

• Don’t rely on sellers to disclose everything—you must investigate and disclose what you know.

• Don’t assume that a buyer will “figure it out” during inspections. If you know something material, disclose it early.

• Don’t try to “talk around” an issue or downplay its importance. Transparency builds trust.

Best Practices for Brokers

• Perform a thorough visual inspection of every property you list.

• Keep detailed records of communication and disclosures.

• When in doubt, disclose—better safe than sanctioned.

• Stay educated with regular CE that covers risk management, disclosure, and ethics.

Elevate Your Practice with Providence

At Providence Real Estate Education, we believe professionalism starts with knowledge—and it shows in every conversation, showing, and closing. Our continuing education courses are designed to give you the tools you need to serve with integrity and stay compliant with both NCREC and NAR expectations.

Want to feel confident about disclosure?
Join us for our risk management CE course. Let’s keep it ethical. Let’s keep it professional.