Oregon broker Alex is representing seller Garcia. After a purchase and sale agreement is fully executed, the buyer discovers that the property is located outside the city's Urban Growth Boundary (UGB). The buyer claims this materially affects the property's development potential and wants to terminate the contract. Which of the following is most accurate regarding the buyer's rights in this situation?

Correct Answer

A) The buyer may terminate only if the UGB status was not disclosed in the seller's property disclosure statement

In Oregon, Urban Growth Boundaries are a critical land use planning element that directly affects property development potential and value. Under Oregon's Seller's Property Disclosure Act (ORS 105.462–105.490), sellers must disclose known material facts affecting the property. If the seller failed to disclose the property's location outside the UGB on the disclosure statement—and this information would materially affect the buyer's decision—the buyer may have grounds to rescind the contract based on the seller's failure to disclose a material fact. The disclosure statement's accuracy is the key trigger for the buyer's rescission right.