What can be a potential consequence of failing to disclose defects in real property?

Failing to disclose defects in real property can lead to legal liability for fraud or breach of contract because sellers have a duty to inform potential buyers about known issues that could affect the property's value or desirability. If a seller knowingly conceals a defect or misrepresents the condition of the property, the buyer may have grounds to pursue legal action based on fraud. This could result in the buyer seeking damages or even rescinding the sale, particularly if the buyer can demonstrate that the seller acted knowingly and intentionally.

Moreover, a breach of contract claim may arise if the sale agreement contains representations regarding the property's condition that the seller fails to uphold due to non-disclosure of defects. Such legal consequences not only have financial implications for the seller but can also affect their reputation in the real estate market, potentially leading to greater scrutiny in future transactions.

In contrast, the other options do not accurately reflect the outcomes of failing to disclose defects. An increase in property value is unlikely as undisclosed defects generally reduce value. Immediate sale of the property might happen without disclosure but would be precarious and likely lead to future legal troubles. Loss of rental income could occur post-sale, but it’s not a direct consequence of failure to disclose defects, which is more pointedly tied