New Regulation Takes Effect on October 15, 2025
While home inspection regulations typically fall outside our usual coverage areas at Agency Checklists, this particular development caught our attention as something about which Massachusetts P&C professionals should be aware of. On June 6, 2025, the Massachusetts Executive Office of Housing and Livable Communities published a new regulation, 760 CMR 74.00: Residential Home Inspection Waivers, establishing the nation’s first comprehensive regulatory framework that prohibits sellers from conditioning real estate offers on home inspection waivers.
Given the significant role homeowners insurance plays in the Massachusetts P&C market—both for carriers and agencies—we thought this first-in-nation regulation warranted a spot in our “good to know” category.
The regulation takes effect on October 15, 2025, and applies to all residential real estate sales occurring after that date.
This groundbreaking regulation followed a requirement in the Affordable Homes Act of 2024, addressing Massachusetts’s hyper-competitive housing market where buyers routinely waived inspection contingencies to strengthen their offers, often discovering expensive surprises only after closing.
Basic prohibition on waiver of inspection agreements and the right of the buyer to walk
The regulation establishes a dual prohibition structure that fundamentally alters the home-buying process.
Under the regulation, neither sellers nor their agents can:
- Demand a buyer waive inspections to have their offers considered, or,
- Can accept an offer where a buyer independently waives inspections, hoping to gain a competitive advantage over other potential offers conditioned on inspections.
The regulation requires both the seller’s and buyer’s signatures on a written home inspection disclosure agreement before any signing of a written offer to purchase or purchase and sale agreement.
This disclosure agreement must state explicitly that the purchase agreement is not contingent upon waiving inspection rights and affirm the buyer’s right to choose a licensed home inspector and have a reasonable time to decide whether to proceed “[I]f the results of the inspection are not satisfactory to the Buyer.”
The regulation also includes a “Render Meaningless” standard that prohibits contract provisions designed to frustrate the effectiveness of inspections. These provisions might include unreasonably limiting inspection scheduling, scope, or timing or preventing buyers from withdrawing based on unsatisfactory results. However, parties may still agree to reasonable monetary thresholds for repair costs or limited forfeiture terms for deposits.
Notwithstanding the regulation’s restrictions on waiving inspections, buyers may waive inspections after an offer’s acceptance, provided the buyer’s decision to waive inspection is made independently, without any involvement from the seller or agent.
Limited Exemptions
The regulation provides specific exceptions for:
- Family transactions involving relatives (broadly defined to include spouses, domestic partners, siblings, children, parents, grandparents, in-laws, and step-relations) and
- Foreclosure and auction sales conducted by licensed auctioneers, and
- New construction where the first contract is executed before substantial completion on the property with express written warranties covering at least one year.
Professional Liability Exposure for Real Estate Agents
Licensed real estate professionals face heightened liability exposure under this regulation. Violations constitute unfair or deceptive practices under Massachusetts General Law Chapter 93A, exposing agents to civil liability, including damages, multiple damages for willful violations, and attorneys’ fees, as well as disciplinary action by the Board of Registration of Real Estate Brokers and Salespersons under M.G.L. c. 112.
Home Inspector Coverage Considerations
The regulation will likely drive an increase in inspection volume as buyer protections strengthen, creating both opportunities and risks for home inspectors. Massachusetts law requires home inspectors to maintain minimum errors and omissions coverage of $250,000 under M.G.L. c. 112, § 225, with a two-year statute of limitations from the date of written report completion.
Seller Liability: Business vs. Private Sales
Sellers operating in a business context—including developers, house flippers, and those regularly engaged in real estate sales—face full liability under MGL Chapter 93A for regulatory violations. This exposure includes actual damages, multiple damages for willful violations, attorneys’ fees, and the potential use of any inspection waiver under the regulation as evidence of intent to misrepresent or conceal material facts.
Individual homeowners selling their own residences in isolated, private sales have no liability under the regulation, provided the transaction is not undertaken in a business context. The only caveat is that if a seller is sued at common law for material misrepresentation within one year of the sale, and the seller violated the regulation, that violation can be used in court as evidence of the seller’s “intent to misrepresent or conceal a material fact in a real estate transaction.”
Conclusion
As of October 15, 2025, this new regulation will change the landscape of home purchases and sales. Like all such legislation, a regulation of this nature can have unintended and unforeseen consequences, favoring one party or the other. In this case, we will have to wait and see how this unique regulation plays out in the sale of Massachusetts residential properties.
Copy of the regulation
For readers who want to review the complete regulation, you can access the full text of 760 CMR 74.00: Residential Home Inspection Waivers by clicking here.
